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PETITIONER: PARICHHAN MISTRY (DEAD) BYLRS. & ANR.

       Vs.

RESPONDENT: ACHHIABAR MISTRY AND ORS.

DATE OF JUDGMENT:       23/08/1996

BENCH: G.B. PATTANAIK (J) BENCH: G.B. PATTANAIK (J) RAMASWAMY, K.

CITATION:  JT 1996 (7)   589        1996 SCALE  (6)142

ACT:

HEADNOTE:

JUDGMENT:                       J U D G M E N T PATTANAIK, J.      This appeal  by the  mortgagors is directed against the judgment of the Patna High Court dated 28th of July, 1980 in the Second  Appeal arising out of a suit for redemption. The plaintiffs/appellants filed  a  suit  for  redemption  of  2 bighas 3  kathas and  6 dhurs  of land in respect of which a usufructuary mortgage bond Exhibit No. 1 dated 4th May, 1980 had  been   executed  in   favour  of  the  defendants.  The defendants had  taken the stand that under the Mortgage Deed the mortgagor  was liable  to pay  rent in  respect  of  the holding and  no rent  having been paid, in a suit instituted by the  landlord for  arrears of  rent, a  decree  had  been obtained and  in execution thereof the property had been put to sale and the defendant-mortgagee paid the decretal amount in question  and, therefore,  a suit for redemption will not lie. The  learned Trial  Judge, however,  decreed  the  suit rejecting the  objection put  forth  by  the  defendant  and granted the  relief of  redemption. Defendants  carried  the matter in  appeal and  the said appeal having been dismissed they approached  the High  Court in  Second Appeal. The High Court by  the impugned judgment having reversed the judgment and decree of the Courts below and having dismissed the suit for redemption the present appeal has been preferred.      The  High   Court  came  to  the  conclusion  that  the mortgagors having  failed to  pay  a  portion  of  rent  for realisation of  which the  landlord had  filed  a  suit  and obtained  a  decree  and  that  said  decree  being  put  to execution and  the mortgagee  having paid  up  the  decretal dues, the  mortgagor looses  his right  of  redemption  and, therefore the  suit for  redemption must  fail. The  learned Judge came  to the conclusion that the equity of redemption, in the  facts and circumstances of the case was extinguished and, therefore, the mortgagor is not entitled to redeem. The short question  that arises  for consideration is whether in the facts  and circumstances  of the case the High Court was

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right in coming to a conclusion that right of redemption got extinguished and  the mortgagor  had no right of redemption. It is true, that a right of redemption under a Mortgage Deed can come  to an end, but only in a manner known to law. Such extinguishment of  right can  take place by contract between the parties  or by  a decree  of the Court or by a statutory provision which  debars the  mortgagors from  redeeming  the mortgage. The  mortgagor’s right  of redemption is exercised by the payment or tender to the mortgagee at the proper time and at  the proper  place, of the mortgage money. When it is extinguished by  the act  of parties  the act  must take the shape and  observe the formalities which the law prescribes. The expression  "Act of  parties" refers to some transaction subsequent to  the mortgage  and  standing  apart  from  the mortgage transaction. A usufructuary mortgage cannot by mere assertion of  his own  or by  a unilateral  act on his part, convert his  position on moiety of the property as mortgagee into that of an absolute owner. It is no doubt true that the mortgagee would be entitled to purchase the entire equity of redemption from  the mortgagor.  The  mortgagee  occupies  a peculiar position and, therefore, the question as to what ha purchases at  a Court sale is a vexed question, but being in an  advantageous   position  where  the  mortgagee  availing himself of  his position  gains an  advantage he holds, such advantage is  for the  benefit of the mortgagor. It has been so held  by this  Court in  the case  of Sidhkamal Nayan vs. Bira Nayak  (AIR  1954  SC  336)  and  Mritunjuoy  Pani  vs. Naramanda Bala  Sasmal (1962)  1 SCR  290.  This  being  the position of  law if  for some  default in  payment of rent a rent decree  is obtained and the mortgagee pays off the same even then  the mortgage in question is liable to be redeemed at the  option of the mortgagor. The mortgagee cannot escape from his  obligation by bringing the equity of redemption to sale in  execution of  a decree on the personal covenant. By virtue of  purchase of  the property  by the  morotgagee  in Court sale, no merger takes place between the two rights nor the mortgage stands extinguished.      In this  view of  the matter  we have  no hesitation to come to  the conclusion  that the High Court committed gross error of  law in  recording a  finding that  the  equity  of redemption stood  extinguished  and  the  mortgagor  is  not entitled to redeem. The impugned judgment of the High Court, accordingly is  set aside  and the  judgment  of  the  Trial Court, as affirmed by the lower Appellate Court is affirmed. The appeal  is allowed, but in the circumstances, there will be no order as to costs.