Dorik Mahto Final

7/27/2019 Dorik Mahto Final

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IN THE HIGH COURT AT PATNA

WRIT APPLICATION (CIVIL) No............. OF 2013

DORIK MAHTO AND ANOTHER ... PETITIONERS

Vs.

STATE OF BIHAR AND OTHERS ... RESPONDENTS

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WRITTEN SUBMISSION BY THE PETITIONERS

BY

COUNSEL FOR PETI TIONER

MARKS FOR SUBMISSION

MARKS FOR PRESENTATION

FACULTY SIGNATURE


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STATEMENT OF FACTS

Nirsu Chamar executed the mortgage bond on 5.3.1915 in favor of Bhabi Mahto and Bikan

Mahto for a sum of Rs.794/- and put them in possession of the land. Under the terms of the

mortgage, the mortgagees obtained possession over the said lands and were entitled to remain in

possession of the mortgaged lands during the term of the mortgage and till the repayment of the

mortgage money and to appropriate the usufruct of the lands in lieu of interest on the mortgage

money. The term of the mortgage was not specifically laid down in the mortgage deed, but the

mortgage contained a promise by the mortgagor to repay the mortgage amount on Baisakh

Purnima, 1385 Fasli corresponding to sometime in 1977. Admittedly respondent Nos.4 to 6

purchased equity of redemption of the lands in question along with other properties from Nirsu

Chamar. Thereafter these respondents filed an application praying that possession of the land

may be restored to them as the mortgage of 1915 stood redeemed under Section 12 of the Bihar

Money Lenders Act (hereinafter referred to as the Act). The prayer was allowed by respondent

No.3 by his order dated 10th

July, 1976, a copy of this order of which has been marked as

Annexure-1. A copy of the mortgage bond has been made in Annexure-2. The order of the

substance is an order to eject from the mortgaged lands Dorik Mahto - petitioner No.1 and

Sakunti Mahtopetitioner No.2, who are the sons of the original Mortgagees Bhabi Mahto and

Bikan Mahto respectively, who are dead. Raj Kishore Jha respondent NO.5 along with

respondent Nos.4 and 6 claim to have purchased the equity of redemption in respect of the lands

covered by the aforesaid mortgage from Nirsu Chamer in 1943 by a registered deed of sale dated


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12.4.1943, copy whereof is Annexure-3 to the writ application for a consideration of Rs.1,000/-.

The order was passed by respondent Deputy Collector, Land Reforms, Samastipur, under Section

12 of the Bihar Money Lenders Act, 1974 on 10.7.1976 in favor of respondents 4 and 6. Hence

the petitioners filed the writ application before the Patna High Court.


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POINT FOR CONSIDERATION

1. That the application before the learned Deputy Collector is null and void, and the applicantbefore the learned Deputy Collector, respondent No.5, respondents 4 & 6 were not the

mortgagor within the meaning of the expression as used in Section 12 of the Act or Rules 9 and

10 of the Rules and, therefore, the application under Rule 10 before the learned Deputy Collector

is not maintainable.


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SUMMARY OF ARGUMENTS

It is humbly submitted before this Honorable Court that the Petitioners filed the writ before the

High Court challenging the order of the Deputy Collector of Land Reforms to eject the

Petitioners. The impugned order, dated 10-7-1976, of the Deputy Collector, Land Reforms,

Samastipur, has allowed the application under Rule 10 of the Bihar Money Lenders Rules, 1975

filed by Respondent No.5, Raj Kishore Jha, in respect of lands which were mortgaged by a deed

of mortgage dated 5-3-1915 executed by Nirsu Chamar, the original owner of the lands which is

the subject matter of the mortgage, in favour of Bhabi Mahto and Bikan Mahto, for a

consideration of Rupees 794/-. The order, in substance, is an order to eject from the mortgaged

lands Dorik Mahto, petitioner No.1 and Sakunto Mahto, petitioner No.2, who are the sons of the

original mortgagees, Bhabi Mahto and Bikan Mahto, respectively, who are both dead. Raj

Kishore Jha, respondents No.5 along with respondents Nos. 4 and 6 claims to have purchased the

equity of redemption in respect of the lands covered by the aforesaid mortgage from Nirsu

chamar in 1943 by a registered deed of sale dated 12-4-1943 for a consideration of Rupees

1,000/-. Under the terms of the mortgage, the mortgagees obtained possession over the said lands

and were entitled to remain in possession of the mortgaged lands during the term of the mortgage

and till the repayment of the mortgage money and to appropriate the usufruct of the lands in lieu

of interest on the mortgage money. The term of the mortgage was not specifically laid down in

the mortgage deed, but the mortgage contained a promise by the mortgagor to repay the

mortgage amount on Baisakh Purnima, 1385 Fasli corresponding to some time in 1977.


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Section 12 of the Bihar Money Lenders Act, 1974 so far as is relevant, runs thus,

"Usufructuary mortgages and their redemption Notwithstanding anything to the

contrary contained in any law or anything having the force of law or in any agreement, the

principal amount and all dues in respect of an usufructuary mortgage relating to any agricultural

land, whether executed before or after the commencement of this Act, shall be the mortgage shall

be deemed to have been fully satisfied and the mortgage shall be deemed to be wholly redeemed

on expiry of a period of seven years from the date of the execution of the mortgage bond in

respect of such land and the mortgagor shall be entitled to recover possession of the mortgaged

land in the manner prescribed under the rules."

The manner of recovery of possession is prescribed by Rules 9 and 10 of the Bihar

Money Lenders Rules, 1975, framed under the Act (hereinafter called the Rules), which runs

thus,

Rule 9. Procedure in case of resumption of mortgaged property by a mortgagor from the

mortgagee under Section 12 of the Act.

1. On the expiry of the period of mortgage as mentioned in Section 12 of the Act, the

mortgagor shall send a notice in Form ML-4 requiring the mortgagee to deliver possession of the

mortgaged property within twenty days from the date of notice and,

2. A copy of the notice shall also be sent by registered post with acknowledgment due by

the mortgagor to the Anchal Adhikari within whose jurisdiction the mortgaged property is

situated.


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Rule 10. Filing of application by mortgagor to eject the mortgagee in case of latter's

failure to put the mortgagor in possession.

1. If on the expiry of the period of notice in Form ML-4, the mortgagee fails or refuses to

deliver possession of the mortgaged property to the mortgagor, the mortgagor shall file an

application in Form ML-5 to the Collector or within whose jurisdiction the mortgaged property

or any portion thereof is situated, to eject the mortgagee from the mortgaged property.

2. The application shall bear a court fee stamp of such value as may be payable for it under

the Court Fees Act, 1870 for the time being in force for an application and shall be accompanied

with the form of the notice in Form L-6 in triplicate.

3. On receipt of application from the mortgagor for ejecting the mortgagee the Collector

shall issue a notice in Form ML-6 to the mortgagee or his legal representative to show cause by a

date to be specified in the notice why the mortgagor should not be put in possession.

4. If no cause is shown on or before the date specified in the notice or by such other date as

may be extended by the Collector or if the cause shown is in the opinion of the Collector, not

satisfactory, he shall pass an order in writing to eject the mortgagee from the mortgaged property

and put the mortgagor in possession and for that purpose he may use such force as may be

necessary.

It is thus manifest that before the collector can pass an order under Rule 10 (4) of the Rules

putting the applicant in possession after ejecting another person from a certain land, it must be

established-

That there is a mortgage in respect of the land; That the mortgage is a usufructuary mortgage;


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That a period of seven years from the date of execution of the mortgage bond haselapsed;

That the applicant claiming possession is the mortgagor; and That the person in possession of the land is the mortgagee.

And he can do so only in accordance with the procedure laid down under Sections 9 and 10 of

the Rules. It is contended on behalf of the Petitioners that the impugned order is null and void

and without jurisdiction.

In the instant case, under Rule 10 of the Rules it must be established that the mortgage is a

usufructuary mortgage. Usufructuary mortgage is defined in Transfer of Property Act, 1882

under Sec.58(d) as Where the mortgagor delivers possession or expressly or by implication

binds himself to deliver possession of the mortgaged property to the mortgagee, and authorizes

him to retain such possession until payment of the mortgage- money, and to receive the rents and

profits accruing from the property or any part of such rents and profits and to appropriate the

same in lieu of interest, or in payment of the mortgage- money, or partly in lieu of interest or

partly in payment of the mortgage- money, the transaction is called an usufructuary mortgage

and the mortgagee an usufructuary mortgagee.

One of the essential elements of usufructuary mortgage is that there should not be any personal

liability of the mortgagor. But in this case it is not an usufructuary mortgage pure and simple

because the mortgagor bound himself personally to pay the mortgage money. The mortgage,

therefore, is a combination of usufructuary mortgage and simple mortgage and is thus neither a

simple mortgage, nor an usufructuary mortgage and, therefore, is a Simple mortgage

usufructuary. Where terms of mortgage are mixture of a simple mortgage and an usufrcutuary

mortgage, the transaction is simple mortgage usufructuary. This is a special category and is


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called anomalous mortgage. A mortgage which is a combination of simple mortgage and

usufructuary mortgage is not an usufrcutuary mortgage within the meaning of expression of Sec.

58(d) of the T.P. Act; it is an anomalous mortgage. It is argued that the expression usufructuary

mortgage in Section 12 of the Act is confined to usufructuary mortgage as defined in Sec. 58 of

the Transfer of Property Act. Therefore, the application under Rule 10 of the Bihar Money

Lenders Rules is not maintainable.

It is also contended mortgagor does not include purchaser of the equity of redemption within

the meaning of Sec. 12 of the Money Lenders Act. The relevant provisions of Section 12 of the

Act and Rule 9 and 10 of the Rules and as pointed out under Section 12 of the Act, the only

person entitled to recover possession is the mortgagor within the meaning of the expression as

used in Section 12 of the Act and no one else. Respondents 4 to 6 claim to be mortgagors within

the meaning of the expression on the ground that they are the purchasers of the equity of

redemption from the original mortgagor, Nirsu Chamar, under the registered sale deed dated 12-

4-1943. The question for consideration is whether the expression mortgagor in section 12 of the

Act includes the purchaser of the equity of redemption. The words of a statute are first

understood in their natural, ordinary or popular sense unless that leads to some absurdity or

unless there is something in the context or in the object of the statute to suggest the contrary.

Crawford v. Spooner1. The principle was reiterated by Iyer, J., speaking for the Supreme Court in

Thanjavur v. Naganatha Ayyar, in these words: The current and correct view of the

interpretative process is that words must be given their literal or ordinary meaning unless there

are compelling reasons, recognized by canons of construction, to the contrary2. The subject

1(1846) 4 MIA 179

2AIR 1979 SC 1487


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matter of Section 12 is law relating to a special kind of loan, namely, a loan advanced upon a

usufructuary mortgage which is a species of transfer of interest in land. Therefore it is necessary

to enquire what does the expression mortgagor mean in the law relating to transfer of property by

a mortgage. The India Law regarding mortgage of immovable property is contained in Chapter

IV of the T.P. Act, 1882 and the terms mortgage, mortgagor, mortgagee etc are defined by

Section 58 of the T.P. Act which runs thus:-

Section 58 :- The transferor is called a mortgagor, the transferee a mortgagee; A mortgagor,

according to S.58, therefore is the transferor, that is to say, the person who transfers an interest in

specific immovable property for the purpose of securing the payment of money advanced or to

be advanced by way of loan etc. The definition of mortgage, mortgagor and mortgagee in

S.58 of the Transfer of Property Act is not an artificial statutory definition. It embodies the

ordinary natural meaning of the terms. As observed by Mahmood, J. regarding the definition of

mortgage in S.58 of the Transfer of Porperty Act in Gopal V. Parsotam3

that definition has

not in any way altered the law but, on the contrary, has only formulated in clear language the

notions of mortgage as understood by all the writers of the text books on Indian Mortgages.

Thus, it is obvious that the definition of mortgagor in S.58 gives the literal ordinary meaning of

the expression mortgagor. It is also obvious that it does not include within its ambit, the

purchaser of the equity of redemption for he does not transfer any interest in property. Giving

to the expression its literal ordinary meaning, the word mortgagor, therefore, does not include

the purchaser of equity of redemption.

3ILR (1883) 5 ALL 121


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It is manifest that there is nothing in the object of the statute to suggest that the expression

mortgagor includes the purchaser of the equity of redemption. According to the preamble, the

Act was passed to consolidate and amend the law relating to regulation of money lending

transactions and to grant relief to debtors in the State of Bihar. The principal object of the Act,

is, therefore, to grant relief to debtors including debtors who offer security for the loans taken by

them. As was pointed out by a Full Bench of Patna High Court in Madho Singh V. State4,

Section 12 of the Act places restriction on the right of the mortgagee-money lender to hold

property under usufructuary mortgage beyond seven years in the interest of a particular class of

the general public, namely, the agricultural debtors. The object underlying Section 12 of the Act,

therefore, is to confer a benefit upon or to grant relief to agricultural debtors who have given

lands in usufructuary mortgage as security for the loan taken by them.

Now the purchaser of the equity of redemption acquires a property subject to an incumbrance

after furnishing consideration for the same. In the transaction by virtue of which he becomes the

purchaser of the equity of redemption, he does not receive but gives money, and he gives the

money for the purpose of acquiring the interest of the mortgagor in the mortgaged property. He

clearly and undoubtedly not a debtor. If any authority is needed for this proposition, reference

may be made to Gajadhar Marwari V. BaidyanathMandal5

in which Jamuar, J. speaking for a

Bench of Patna High Court observed.- They are purchasers of the equity of redemption of the

mortgagor and thus not themselves debtors. The object of the Act and particularly of Section 12

thereof, therefore, does not require us to give an extended meaning to the expression mortgagor

to include within its ambit the purchaser of the equity of redemption who is not a debtor whom

alone the Act is designed to benefit. In the majority of the cases, the purchaser of the equity of

4AIR 1978 Pat 172

5AIR 1950 Pat 379


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redemption is a person in affluent circumstances, whose condition does not require conferment

of any special benefits. He is not the victim of any unconscionable bargain like the mortgagor

who has executed usufructuary mortgage in respect of the agricultural land, majority of whom,

according to Patna Court in Madho Singhs case are victims of unconscionable money lending

transaction. More often straitened circumstances of the mortgagor and the mortgagors inability

to redeem the mortgage, he has purchased the mortgagors interest for less than its fair price. It

may be just and reasonable to restrict the right of the usufructuary mortgagee to remain in

possession of the land for the term of the mortgage and till the payment of the mortgage money

for conferring benefit on the mortgagor, the victim of the unconscionable transaction. But it

seems neither just nor reasonable to restrict the aforesaid legal right of the mortgagee for

conferring a benefit on the purchaser of the equity of redemption who equally with the

mortgagee usually belongs to the class of the haves and not of the have nots and is not the victim

of any unconscionable transaction.

The object of the enactment may require us to include within the expression mortgagor his

legal representatives, as the heirs of the debtors may well be regarded as debtors and in need of

the benefit conferred by Section 12. But merely because the natural meaning has to be departed

from to include the heirs and legal representatives of the mortgagor, is no reason for extending

the meaning to include the purchaser of the equity of redemption also who does not come in the

category of debtor the class which was intended to be benefited by the Act. As observed by Lord

Wensleydale in the oft quoted passage The grammatical and ordinary sense of the word is

adhered to, unless that would lead to some absurdity, or some repugnance or inconsistency with

the grammatical and ordinary sense of the words may be modified, so as to avoid that absurdity

and inconsistency, but no further


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The aim and object of the enactment, therefore, does not compel to extend the ordinary meaning

of the expression mortgagor to include the purchaser of the equity of redemption, nor does the

context in which the expression mortgagor occurs. So it is important to bear in mind the object

of the enactment which is to grant relief to debtors, there seems no warrant for holding that these

persons can also redeem the mortgage when by virtue of the statutory fiction, the mortgage is

deemed to be redeemed.

The reason of the rule enacted in S. 12 of the Act being to grant relief to a debtor does not apply

to the purchaser of the equity of redemption because the purchaser of the equity of redemption is

not a debtor. Support for this can be drawn from the decision of the Bombay High Court in

Manubhai V Trikamlal6. In this case the purchaser of equity of redemption with whom the

amount of the mortgage money was kept in deposit filed an application und7er Sec. 4 of the

Bombay Agricultural Debtors Relief Act and an award was passed by the Court under the

Bombay Act. After the appeal from the award was dismissed, the heirs of the mortgagee moved

the Bombay High Court in revision and contended that the award was null and void because an

application under the Bombay Act for adjustment of the mortgage debt on behalf of the

purchaser of the equity of redemption did not lie as he was not a debtor within the meaning of

Sec.4 of the Bombay Act. Sec. 4 of the Bombay Act, so far as it is relevant, was as follows:-

any debtor.. may make an application to the court for adjustment of his debt

6AIR 1960 Bom 247


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The definition of debt in the Bombay Act included a debt secured by a mortgage. The question

for consideration was whether having regard to the fact that he had purchased the equity of

redemption and retained a sum of money out of the purchase price to be paid to the mortgagee in

satisfaction of the mortgage debt, the purchaser of the equity of redemption was a debtor of the

mortgagee in respect of the aforesaid mortgage debt was his debt. It was argued on behalf of the

mortgagor on the strength of Sec. 59-A of the Transfer of Property Act that the purchaser of the

equity of redemption was the mortgagor in respect of the mortgage debt, the purchaser of the

equity of redemption being a mortgagor must also be regarded as a debtor and the mortgage debt

must be regarded as his debt within the meaning of the expressions as used in Sec. 4 of the

Bombay Act. Negativing that argument, Miabhoy, J., who delivered the judgment of the Bombay

High Court in that case, held that the loan on the mortgage having been taken by the mortgagor,

the mortgage debt was the debt of the mortgagor and not of the purchaser of the equity of

redemption and, therefore, no application for adjustment under Sec. 4 of the Bomaby Act could

be made by the purchaser of the equity of redemption as the application was not for adjustment

of his debt. If the expressions debtor and his in the Bomaby Act, which, like the Act, was

enacted for the relief of the debtor may not be given an extended meaning to include within their

ambit the purchaser of the equity of redemption, on a parity of reasoning the expression

mortgagor in Section 12 of the Act may not be given an extended meaning to include the

purchaser of the equity of redemption.

Therefore, the expression mortgagor in Section 12 of the Act or Rule 9 and 10 of the Rules do

not include the purchaser of the equity of redemption and, therefore, the application under Rule

10 by Respondent No. 5 was not maintainable and the learned Deputy Collector had no


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jurisdiction to pass an order at his instance ejecting the mortgagee petitioners and restoring the

Respondent No.5 to possession and, therefore, the impugned order is null and void.

Dorik Mahto Final

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