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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
-------------------------------------------------------------------------------------------------------------
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.