Madras High Court

V.Poongodi vs P.Shanthi on 22 June, 2023

                                                                                   S.A.No.409 of 2023
                                                                           and C.M.P.No.12576 of 2023




                                   IN THE HIGH COURT OF JUDICATURE AT MADRAS

                                                 DATED: 22.06.2023

                                                      CORAM:

                                  THE HONOURABLE MRS. JUSTICE R. HEMALATHA

                                                 S.A.No.409 of 2023
                                                        and
                                               C.M.P.No.12576 of 2023

                     V.Poongodi                                          ..Appellant
                                                           vs.

                     1.P.Shanthi
                     2.Karuneegar Aanmeega Trust,
                       Rep. by its Founder Trustee
                       G.Narayanan                                       ..Respondents

                     PRAYER: Second Appeal filed under Section 100 of Civil Procedure
                     Code against the decree and judgment dated 23.12.2022 in A.S.No.7 of
                     2018 on the file of the Principal Sub Court, Chengalpattu @
                     Kancheepuram District, upholding the decree and judgment dated
                     15.12.2017 in O.S.No.57 of 2007 on the file of the District Munsif cum
                     Judicial Magistrate, Thirukazhukundram.


                                           For Appellant         : Mr.D.Ramesh Kumar




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https://www.mhc.tn.gov.in/judis
                                                                                        S.A.No.409 of 2023
                                                                                and C.M.P.No.12576 of 2023



                                                       JUDGMENT

The first defendant who failed before both the Courts below had

filed the present second appeal. The respondents/plaintiffs filed the suit in

O.S.No.57 of 2007 on the file of the District Munsif cum Judicial

Magistrate, Thirukazhukundram, for redemption of mortgage.

2. For the sake of convenience, the parties are referred to as

per their ranking in the trial court and at appropriate places, their rank in

the present second appeal would also be indicated.

3. The case of the plaintiff in nutshell is as follows:

The plaintiff and her husband T.V.Panchaksharam had

borrowed a sum of Rs.1,00,000/- from the defendant and executed a

registered simple mortgage (Ex.A1) on 27.03.2003 through which the suit

property, which was a portion of the super structure constructed by late

T.V.Panchaksharam (husband of the first plaintiff), was mortgaged. The

plaintiff's husband entered into a lease agreement with the second

defendant in respect of the suit property belonging to them and he was

also paying rents to the second defendant. Even though the mortgage was

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

a simple mortgage, the first defendant was orally permitted to occupy the

property mortgaged by the plaintiff's husband in lieu of interest for the

amount borrowed under the mortgage. Since T.V.Panchaksharam was

indisposed, he could not discharge the mortgage loan and ultimately he

died on 04.07.2004, leaving behind the plaintiff and his two minor sons to

succeed to his estate. The plaintiff, as one of the legal heirs of the

deceased T.V.Panchaksharam, is entitled to redeem the mortgage.

Though the plaintiff approached the first defendant on several occasions

and offered to pay the entire principal sum of Rs.1,00,000/- towards

discharge of the mortgage loan, the first defendant refused to receive the

same and thereafter, the plaintiff issued a legal notice (Ex.A5) to the first

defendant and the first defendant after receiving the said notice sent a

reply notice dated 23.06.2007 (Ex.A6) which, according to the plaintiff,

contained false allegations. The plaintiff also sent a rejoinder dated

05.07.2007 (Ex.A7) to the first defendant. Since the first defendant did

not come forward to receive the mortgage loan amount, she was

constrained to file the present suit for redemption of mortgage.

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

4. The suit was resisted by the first defendant on the following

grounds:

i. It is true that the plaintiff's husband T.V.Panchaksharam borrowed

a sum of Rs.1,00,000/- from the first defendant and executed a

simple mortgage deed dated 27.03.2003 (Ex.A1) and the rate of

interest was fixed at 24% per annum.

ii. The plaintiff's husband never paid any interest towards mortgage

loan. The contention of the plaintiff in her plaint that though the

document is only a simple mortgage, the first defendant was orally

permitted to occupy the property mortgaged by her husband in lieu

of interest for the amount borrowed under the mortgage deed is

totally false.

iii. The plaintiff's husband was badly in need of money and therefore

he sold the portion of the property to the first defendant for a

valuable consideration and the first defendant is in possession of

the same. Since a portion of the suit property belongs to the second

defendant, the sale deed could not be registered.

iv. The allegations in the plaint that the plaintiff approached the

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

defendant on several occasions and offered to pay the entire

principal amount is totally false. The first defendant is not bound to

deliver the possession of the suit property to the plaintiff, since the

mortgage is a simple mortgage and the plaintiff has to pay interest

amount towards the said mortgage amount. He therefore prayed for

dismissal of the suit.

5. The second defendant remained absent through out the

proceedings and therefore, he was set ex parte.

6. On the basis of the above pleadings, the trial Court Judge

framed the following issues :

i. "Whether the plaintiff is entitled for the relief of preliminary decree

to direct the first defendant to redeem the mortgage and return the

mortgage deed dully cancelled and deliver the possession by

receiving the principal amount as prayed for ?

ii. To what other reliefs ?"

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

7. In the trial Court, the plaintiff examined herself and marked

Ex.A1 to Ex.A10. The first defendant examined herself as DW1 and

marked Ex.B1 & Ex.B2.

8.After full contest, the learned District Munsif cum Judicial

Magistrate, Thirukazhukundram, decreed the suit in favour of the plaintiff

vide his decree and judgment dated 15.12.2017 on the following grounds:

i. The evidence adduced on both sides including the mortgage deed

(Ex.A1) clearly shows that the plaintiff's husband

T.V.Panchaksharam borrowed a sum of Rs.1,00,000/- and executed

a simple mortgage deed (Ex.A1) in favour of the first defendant on

27.03.2003. This fact was also admitted by the first defendant.

ii. The first defendant filed an unregistered sale deed before the trial

Court and the same was marked as Ex.B1. There are no pleadings

with regard to the alleged sale deed in the written statement filed

by the first defendant. Moreover, reply notice dated 23.06.2007

(Ex.A6) does not also mention the exact date of purchase of

the suit property by the second defendant. Hence, the

alleged sale transactions between T.V.Panchaksharam and the

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

second defendant cannot be accepted.

iii. Ex.B1 is an unregistered instrument and therefore, it has also been

filed after a lapse of ten years from the institution of the suit and

therefore, the same cannot be accepted for any purpose.

iv. The first defendant as DW1 during the course of cross examination

admitted that she was a tenant in the suit property and was paying

rents to late T.V.Panchaksharam. Thereafter, she continues to be in

possession of the suit property. Thus, it is seen that though the

mortgage deed is a simple mortgage, the conduct of the parties

shows that it is not a simple mortgage but an usufructuary

mortgage. The plaintiff is, thus, entitled for redemption of

mortgage.

9. Aggrieved over the decree and judgement passed by the trial

Court, the first defendant filed an appeal in A.S.No.7 of 2018 before the

Principal Sub Court, Chengalpattu. The learned Principal Subordinate

Judge, Chengalpattu, after analysing the oral and documentary evidence

adduced on both sides upheld the findings recorded by the trial Court and

dismissed the appeal filed by the first defendant vide her decree and

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

judgement dated 23.12.2022.

10. Now the present second appeal is filed.

11. The substantial questions of law raised in the memorandum

of grounds of appeal is extracted hereunder :

i. "Whether the Courts below rightly held that the land of the suit

schedule property belongs to the 2nd respondent/2nd defendant and

the superstructure alone belongs to the 1st respondent/plaintiff's

husband. For the reason only the 1st respondent/plaintiff's husband

executed unregistered sale deed in favour of the appellant/1st

defendant was not considered by the learned trial Court?

ii. Whether the Courts below rightly considered Ex.B1 unregistered

sale deed and Ex.B2 property tax in the name of appellant/1st

defendant which clearly proved that the appellant/1st defendant

purchased the suit property, based on the above Ex.B1 she paid the

property tax in her name?

iii. Whether the Courts below rightly considered the 4th defendant who

abused his official powers and obtained patta in the name of his

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

relatives in respect of the suit property?

iv. Whether the trial Court below framed the issues in respect of Ex.B1

and B2?"

12. Mr.D.Ramesh Kumar, learned counsel for the appellant

contended that the first defendant in her written statement had clearly

indicated the date of execution of the sale deed. The trial Court had

wrongly found that there is no pleading in this regard in the written

statement. He would also contend that the first defendant was in

occupation of the property since 2001, as a purchaser of the suit property

based on Ex.B1 sale deed. He would therefore, contend that the findings

of both the Courts below are perverse.

13. It is an admitted fact that the plaintiff's husband

T.V.Panchaksharam borrowed a sum of Rs.1,00,000/- from the first

defendant on 27.03.2003 and executed a registered simple mortgage deed

in her favour. A copy of the mortgage deed was marked as Ex.A1. The

first defendant was already a tenant in the suit property of

T.V.Panchaksharam and she continued to be in possession of the same.

The contention of the first defendant is that on the date of the mortgage

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

deed itself a sale deed was executed by late T.V.Panchaksharam in favour

of the first defendant. In order to substantiate the same, an unregistered

sale deed dated 27.03.2003 (Ex.B1) was pressed into service. When the

defendant claims title through the said unregistered sale deed it is not

known as to how the trial Court marked the same as an exhibit especially

when it is totally inadmissible in evidence. However, both the Courts

below had analysed this particular document (Ex.B1) and concurrently

held that no credence can be attached to Ex.B1 for the following reasons :

(a) Ex.B1 is an unregistered sale deed.

(b) There is no mention about the sale deed either in the mortgage deed

or in the reply notice (Ex.A6).

(c) The relationship of the plaintiff's husband T.V.Panchaksharam and

the defendants are only a landlord - tenant and thus the defendants

are put in possession of a portion of the suit property which was

also mortgaged. Therefore, the contention of the defendant is that

he was put in possession of the suit property on the basis of the sale

deed cannot be accepted.

The first Appellate Court had also observed thus :

11. It is relevant to determine the character of Possession

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

with the hands of first Defendant. Two rival pleadings regarding the character of Possession before this Court. The perusal of Ex A5 Legal Notice, Ex A7 Reply Notice caused by Plaintiff and Plaint would speaks that the Property described in the Schedule of Mortgage Deed Possessed by first defendant is only under permissive occupation in lieu of Interest for the Amount borrowed. The Reply Notice of first defendant Ex A6 and Written Statement of First Defendant denied said allegations as to permissive occupation and put forth that their possession with reference to Mortgaged property is based on Unregistered Sale Instrument executed by Plaintiff’s husband Panchaksharam as the land belongs to Karuneegar Aanmeega Trust. The Ex B1 and Ex B2 are relied on.

12. The First Defendant claims that Plaintiff’s husband executed unregistered sale deed. The Ex B1 is unregistered Instrument . On Scanning of said unregistered Sale Instrument, it comprises of three pages . The first page is Rs. 20/- Indian Non Judicial Stamp paper purchased from S. Mohan Kumar Stamp Vendor at Thangasalai , Chennai in the name of Poongodi on 27.03.2003 . The vendor is Panchakshram and purchaser is Poonkodi. The second and third page are scribed in Green paper . There are two witnesses. It is noteworthy to state that both instruments i.e.

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

Ex A1 and Ex B1 are born on 27.03.2003. The Consideration mentioned in Ex B1 is for a sum of Rs. 1,00,000/-. The essentials of sale contemplated is it can be effected only by a registered instrument if it is of the value of Rs. 100-/- (Rupees one hundred only) or upwards . Admittedly, the instrument is unregistered one for the property which is more than the value of Rs. 100/- (Rupees one hundred only). Therefore the Sale is affected by want of Registration.

13. It is significant to decide about Evidentiary value of unregistered Instrument of Sale dated 27-03-2003 which is marked as Ex B1. The unregistered instrument affecting immovable property and required by the Transfer of Property Act to be registered may be received as Evidence for collateral transaction. The nature of possession and purchaser obtained a lien by the passing of consideration can be determined. It is necessary to scrutiny the evidence of Dw1. The oral testimony of Dw1 says that she resides in suit property as a tenant for monthly rent since 2001 and paid the Rent till the date of execution of Mortgage Deed dated 27.03.2003. Neither Plaintiff nor her husband did not pay any amount after execution of Ex A1. Further Dw1 did not receive any amount towards interest for Mortgage loan and did not caused any notice of demand to Plaintiff’s husband till life time and thereafter to Plaintiff as to payment of

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

interest pursuant to Mortgage loan. There is no demand as to Rent or Interest with respect to suit property. On analyzing the oral evidence of Dw1, the factum that the possession of suit property prior to Mortgage Deed dated 27.03.2003 and payment of Rent till the day of execution of Mortgage Deed is an admitted fact. Under these circumstances the Possession of first defendant cannot be construed as based upon either Mortgage Deed or unregistered Instrument of Sale. It is clear and lucid that the first defendant resides in the property since 2001 as a Tenant. The relationship of Plaintiff’s husband with first defendant is only as a Landlord and Tenant with reference to Possession of suit property. Therefore, the contention of Defendant regarding possession on the basis of Sale deed is not acceptable.

14. The Plaintiff claim that the Monthly rent is not received from the date of execution of Mortgage deed dated 27.03.2003 as it is only an adjustment. The said adjustment is towards payment of interest. Once the Dw1 speaks in her evidence that payment of Rent is made till execution of Mortgage deed and not thereafter then this Court can construe the nonpayment of monthly rent was towards the Adjustment in payment of interest for the secured loan under contract of Mortgage. Admittedly the possession can be termed only as adjustment as there is no recitals regarding

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

possession in the Mortgage Deed. The outstanding feature of the Simple Mortgage is that Possession is not delivered to the Mortgagee but remains with the Mortgagor. The Possession of first defendant since 2001 which is prior to Ex A1 and Ex B1 remains in the same character as a permissive occupation . The Character of Possession does not changed by execution of Ex A1 and Ex B1. Above all the testimonies are obvious to conclude that delivery of Possession is not effected pursuant to Mortgage Deed or Unregistered Instrument. Therefore the Evidences are sufficient and satisfactory to conclude that the possession of first defendant is only as a permissive occupation. There is no evidences to prove contra."

14. All the above observations of the First Appellate Court are

based on sound principles of law and I do not find any infirmity in the

decree and judgment passed by both the Courts below. In the

circumstances, the second appeal fails and therefore, is dismissed. In fact

there are no substantial questions of law involved in the present second

appeal.

https://www.mhc.tn.gov.in/judis S.A.No.409 of 2023 and C.M.P.No.12576 of 2023

15. In the result,

i. the Second Appeal is dismissed. No costs. Consequently, connected

Civil Miscellaneous Petition is closed.

ii. the decree and judgment dated 23.12.2022 in A.S.No.7 of 2018 on

the file of the Principal Sub Court, Chengalpattu @ Kancheepuram