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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