Mahant Ramdhan Puri Vs. Bankey Bihari
Saran & Ors [1958] INSC 64 (23 May 1958)
SUBBARAO, K.
GAJENDRAGADKAR, P.B.
SARKAR, A.K.
BOSE, VIVIAN
CITATION: 1958 AIR 941 1959 SCR 1085
ACT:
Deed, construction of-Mortgage or lease-Accounts-Mortgagee,
if bound to render account--Transfer of Property Act (IV of 1882), ss. 76 and
77.
HEADNOTE:
D executed a document in favour of M
hypothecating an eight annas share in a village for the purpose of discharging
a debt of Rs. 29,496 payable by him to Al. In respect of this property there
was a pre-existing think in favour of j for a period of 9 years, under which D
took Rs. 2,205 as peshgi money without interest and the annual rent was fixed
at RS.
2,205. The document provided that (i) interest
at 1/2 per cent. per month was payable on the sum Of Rs. 29,496 ; (ii) (luring
the subsistence of the thika M would receive the rent from j and appropriate
Rs. 1,769-12-o towards interest and pay Rs. 435-4-o as rent to D ; (iii) after
the expiry of the thika M would take physical possession of the land and
appropriate the produce towards interest and Pay Rs. 435-4-o as rent to D; (iv)
on the expiry of the thika M would repay the peshgi amount of Rs. 2,205 to j
and this sum was added to principal amount due ; (v) on the expiry of 15 years,
or after the extended period, D would repay the entire principal amount; (vi)
and the property was given as security for the amount payable by D. The
respondents who are successors of D instituted a suit for redemption on the
basis that the transaction was a usufructuary mortgage, for rendition of
accounts and for recovery of surplus profits.
The appellant, successor of M, contended that
the suit for redemption was not maintainable as the transaction was not a
mortgage but a lease, and that even if it was a mortgage there was no statutory
liability to render accounts as the document provided that the receipts were to
be taken in lieu of interest and the case was governed by S. 77, Transfer of
Property Act :
Held, that the transaction was a mortgage and
not a lease.
The guiding rule of construction is that the
intention of the parties must be looked into and that once there is debt with
security of land for its redemption the arrangement is a mortgage by whatever
name it is called.
Held, further, that there was a contract
between the mortgagor and the mortgagee within the meaning Of S. 77, Transfer
of Property Act to the effect that the receipts from the mortgaged property be
taken in lieu of interest and consequently the mortgagee was not liable to
render accounts. The stipulation 1086 in the document for payment of Rs.
435-4-0 to the mortgagor was a personal obligation of the mortgagee and he had
a right to take the entire receipts from the land in lieu of interest. Though
the rate of interest is stated as per cent. per month it was mentioned to
enable the parties to approximately fix the amount to be appropriated by the
mortgagee from and out of the rent received from the thikadar. The mere fact of
the mention of the rate of interest could not make s. 77 inapplicable in view
of the clearly expressed intention of the parties.
Pandit Bachchu Lal v. Chaudhri Syed Mohammad
Mah, (1033) 37 C. W. N. 457, referred to.
CIVIL APPELATE JURISDICTION: Civil Appeal
-No. 239 of 1954.
Appeal from the judgment and decree dated
December 12, 1950, of the Patna High Court in Appeal from Original Decree No. 188
of 1945 arising out of the judgment and decree dated December 18, 1945, of the
Court of the Additional Subordinate Judge, IV Class, Gaya, in Title Suit No. 4
of 1945.
Purshottam Tricumdas and S. P. Varma, for the
appellant.
S.P. Sinha and R. C. Prasad, for respondents
Nos. 1-4, 810, 13 and 14.
1958. May 23. The Judgment of the Court was
delivered by SUBBA RAO J.-This appeal by certificate tinder Art. 133 (1) (a) of
the Constitution of India is directed against the judgment and decree of the
High Court of Judicature at Patna setting aside those of the Subordinate Judge,
Gaya, in a suit for redemption of an usufructuary mortgage.
Deokinand, the common ancestor of
plaintiff-respondents 1 to 4 and proforma respondents 6 to 12, executed a
document dated August 20, 1923, in favour of Mahant Tokhnarain Puri of Nadra,
the predecessor-ininterest of defendant 1, hypothecating eight annas milkiat
share in mauza Lodipur, Mahimabigha, Tauze No. 4246 for the purpose of
discharging a debt of Rs. 31,701 payable by him to the Mahanth. There are
conflicting versions in regard to the nature of this transaction-respondents
claim it to be a usufructuary 1087 mortgage, while the appellant asserts it to
be a lease.. The plaintiff-respondents instituted Title Suit No. 4 of 1945 in
the Court of the Additional Subordinate Judge 1V, Gaya, for redemption of the
said document on the basis that it was a usufructuary mortgage, for rendition
of accounts and for the recovery of surplus profits due to them. The appellant
pleaded, inter alia, that the suit for redemption was not maintainable as the
document was not a mortgage but lease, that on the assumption that it was a
mortgage it would only be an anomalous mortgage in respect where of there was
no statutory liability to render accounts to the plaintiff, that even if it was
a usufructuary mortgage, it was governed by the provisions of s. 77 of the
Transfer of Property Act taking the mortgage out of the purview of s. 76 (d)
and (g) of the said Act.
It is not necessary to particularize other
defences as nothing turns upon them in the appeal. The learned Subordinate
Judge held that the document created a usufructuary mortgage and not a lease
and that s. 77 of the Transfer of Property Act applied to the document
exonerating the appellant from any liability to render accounts. In the result,
the learned Subordinate Judge gave a conditional decree in favour of respondents
I to 4 for possession on their depositing in Court a sum of Rs. 26,839-7-0
within six months from the date of the decree. The plaintiffrespondents
preferred an appeal against that decree to the High Court at Patna. The High
Court agreed with the learned Subordinate Judge that the document was a
sufructuary mortgage but differed from him on the question of applicability of
s. 77 of the Transfer of Property Act. The High Court set aside the decree of
the learned Subordinate Judge and passed instead a preliminary decree for
redemption and sale on default of payment: the decree also directed the
rendition of accounts between the parties in the light of the directions given
in the judgment. The second defendant against whom the decree was passed
preferred the above appeal.
The point to be first decided is whether the
transaction is a lease as contended by the contesting respondents. The only
guiding rule that can be extracted 1088 from the cases on the subject is that
the intention of the parties must be looked into and that 'once you get a debt
with security of land for its redemption, then the arrangement is a mortgage by
whatever name it is called' (See Ghosh on Mortgages, V Edn., Vol. 1, p. 102).
Let us now examine the terms of the document Exhibit A (3) to ascertain the
intention of the parties. The document was obviously not drafted by a trained
mind. It appears to be a confused product of one of those village
document-writers.
We shall read the document, omitting the
recitals not material to the question raised: The first part of the document
recited that the executant was heavily indebted to the other party under
mortgage bonds and also otherwise and that common friends settled that a part
of the properties mortgaged should be let out in ijara with possession at a
lower rate of interest so that 'the increment of interest may be checked and
the present necessities may be met ". It was also stated in the document
that in respect of the said property there was a pre-existing thika (lease)
dated April 21, 1922, in favour of Munshi Dodraj Lal alias Munshi Jatadhari
Lal, for a period of 9 years and that under the said lease, Rs. 2,205 was taken
by the executant as peshgi money without interest and the rent was fixed at a
sum of Rs. 2,205. Then the document proceeds to state thus:
" In respect of Rs. 29,496 the total sum
of peshgi money, he should, for the satisfaction of interest thereon, get
executed a usufructuary mortgage deed bearing a lower rate of interest in
respect of 8 annas share i. e., half share in mauza Lodipur Mahima Bigha,
principal with dependencies, together known and unknown tola and totals
..................................for term of 15 years on fixing Rs. 2,205 as
the annual rental and by getting mortgaged there. under 8 annas proprietary interest,
thikadari interest together with peshgi money and the right to receive
thikadari rent from the said thikadars.
Accordingly, at the request and entreaty of
me, the executant, the said Mahanthji took pity at my condition and agreed to
my request and got ready to get usufructuary mortgage deed executed. Therefore,
1, the executant, 1089 ".................. have voluntarily let out in
ijara with possession the whole and entire 8 annas i. e., half of Mauza Lodipur
Mahima Bigha.....for a peshgi money of Rs.
31,701that Rs. 29,496, the peshgi money
bearing interest at 1/2 per cent. per month and Rs. 2,205, tile peshgi money
without interest, at an annual rental of Rs. 2,205 including revenue and
cesses, for a term of 15 years, commencing from 1331 Fasli to 1345 Fasli
............... and have put him in possession and occupation of the ijiara
property as my representative. It is desired that the said ijaradar should
enter into and remain in possession and occupation of the ijara property and so
long as the thika of' Munshi Dodraj Lal alias Jatadhari Lal
.................................is intact and in force, he should realize the
rent from the above-named thikadars and their heirs and representatives in
accordance with the stipulations made in the thika patta and kabuliat as
representative of me, the executant, and bring it into his possession and use,
that is to say, on his own authority he should set off Rs. 1,769-12-0 on
account of the interest on the peshgi money bearing interest mentioned in this
deed, year after year, and pay the remaining sum of Rs.
435-4-0, the amount of rent due by the
ijaradar, i.e., the reserved rent, to me, the executant, and my heirs and
representatives The ijaradar should not make any default.
If he does so, he and his heirs and
representatives shall be held liable to pay interest at 1/2 per cent. per
month." Then the document proceeds to incorporate the terms agreed upon by
the parties, to take effect after the termination of the thikadari interest. It
is stated:
" The ijaradar of this ijara deed or his
heirs and representatives on his own authority shall be competent to bring the
thika property into his sir possession as ijara property as a representative of
me, the executant, in accordance with the stipulations made in the patta and
kabuliats after setting off Rs. 2,205 the peshgi money due to the thikadars by
me, the executant, against the annual thikadari rent. The said ijaradar should
make his own arrangement for the cultivation of the ijara property, get it
cultivated 1090 by others, realise the nakdi and jinsi income of the ijara
property from the tenants and appropriate the produce of both the shares
thereof. 1, the executant, and my heirs and representatives neither have nor
shall have any right, claim and. demand in respect of tile produce or the
income of the ijara property so long as the ijara deed is intact except getting
Rs. 435-4-0, the rent after the payment and deduction of interest on the peshgi
money bearing interest." The document then allocates the liability in
respect of improvements and sums spent in regard to boundary disputes to one or
other of the parties to the document and then it continues to state:
" The peshgi money amounting to Rs.
31,701 with and without interest as mentioned in this ijara deed has been
realized from the ijaradar in this manner that I allowed Rs. 28,246, the amount
of loan principal with simple and compound interest as per account given below
after remission of the interest due to the ijaradar under all the three
mortgage bonds to be set off against the peshgi money by getting a note made to
that effect on the back of the said mortgage bonds which I allowed to remain
with the ijaradar as a proof of penitent of the peshgi money covered by this
deed The term of this ijara deed with possession shall terminate in the month
of Jeth, 1345 Fasli, when 1, the executant, or my heirs and representatives
shall repay Rs. 31,701 being the peshgi money with and without interest
mentioned in this deed in cash and in one lump sum to the said ijaradar or his
heirs and representatives, 1 shall bring the ijara property into my sir
possession. If I do not repay the peshgi money with and without interest on the
expiry of the term of this ijara deed with possession, then, till the repayment
of the whole and entire peshgi money with and without interest, this ijara deed
with possession shall precisely with all the stipulations remain in force and
intact. 1, the executant, or my heirs and representatives shall not put forward
any sort of claim or demand in respect of an increase in the produce save and
except the claim 1091 for getting rent as fixed and the mentioned above......
................................................
in security of the payment of the peshgi
money with or without interest mentioned in this ijara deed I, the executant,
have mortgaged, hypothecated, encumbered and made liable the ijara property. I
do hereby make a trustworthy declaration that till the repayment of the entire
peshgi money of the ijaradar I shall not in any way directly or indirectly on
any allegation mortgage, hypothecate. encumber and transfer the ijara
property." The gist of the aforesaid transaction may be stated thus:
The executant was indebted to the other party
in a large amount under mortgage bonds 'and otherwise. Through the intervention
of common friends, with a view to salvage some property, the amount due from
the executant to the other party was fixed in the sum of Rs. 29,496 and it was
settled that half share in mauza should be given as security to the other
party. At the time of the execution of the document there was an outstanding
thika document in favour of a third party, whereunder the said party advanced a
sum of Rs. 2,205 to the executant and agreed to pay Rs. 2,205 as annual rent.
As the other party agreed to discharge the
advance paid by the third party to the executant, the right to collect the rent
from him was also agreed to be given as security to the other party. With the
result, the executant received Rs. 31,701 under the document, out of which Rs.
29,496 bore interest at i per cent. per month and Rs. 2,205 did not carry
interest, presumably because the other party did not actually pay the amount to
the executant. The document divided the transaction into two parts. The first
part dealt with the terms governing the parties during the subsistence of the
thikadari interest; the second part mentioned the terms binding on the parties
after the expiry of the said interest. During the first period, the other party
would receive the annual rent of Rs. 2,205 from the thikadars, set off Rs.
1,769-12-0 on account of interest on the peshgi money bearing interest and pay
the 139 1092 remaining sum of Rs. 435-4-0 as reserved rent to the executant.
After the expiry of the thikadari interest in 1338 Fasli, the other party would
take actual possession by setting off Rs. 2,205 the peshgi money due to the
thikadars by the executant, against the annual thikadari rent. After getting
possession of the ijara property, the other party would make arrangements for
its cultivation and appropriate the produce towards interest, paying the
executant only a sum of Rs. 435-4-0 as rent. The previous deeds were discharged
and endorsements to that effect made on the back of the documents. If the debt
was not discharged within 1345 Fasli, it was agreed that till the repayment of
the entire peshgi money, the ijara deed with possession would precisely with
all stipulations remain in force and intact. The executant, in express terms,
undertook not to put forward any sort of claim or demand in respect of the
increase in the produce except and save to get rent as fixed in the document.
From the aforesaid summary of the recitals in
the document, the following facts emerge: (1) The executant owed large sums of
money to the other party; (2) interest at i per cent. per month was agreed to
be paid on the sum of Rs.
29,496, i.e., on the entire consideration
excluding that amount which was advanced by the thikadars to the executant;
(3) the manner of discharging the debt was
prescribed in the document, namely, that during the subsistence of the
thikadari interest, the other party would receive the rent from the thikadars
and appropriate Rs. 1,769-12-0 on account of interest and pay a sum of Rs.
435-4-0 as rent to the executant and that after the expiry of the thikadari
interest, the other party would take physical possession of the land and
appropriate the produce towards interest and pay only a sum of Rs. 435-4-0 as
rent to the executant; (4) on the expiry of 15 years period or after the extended
period, the executant would pay the entire principal amount to the other party;
(5) 8 annas share in the mauza was specifically given as security for the
amount payable by the executant. Under the document, there was a relationship
of creditor and debtor between the 1093 parties and the property was given as
security for the payment of the amount advanced with interest. Though the
document is described as a cowle, the parties, who have had earlier
transactions, must be deemed to have known the nature of the transaction they
were entering into. In clear and express terms the nature of the transaction
has been stated in more than one place. The executant, requested the other
party, in respect of the advance amount and interest to get executed by him a
usufructuary mortgage deed bearing a lower rate of interest in respect of the 8
annas share.
After mentioning the various terms, the
executant restated the intention of the parties in the following terms:
"In security of the payment of the
peshgi money with or without interest mentioned in this ijara deed, I, the
executant, have mortgaged, hypothecated, encumbered and made liable the ijara
property." Therefore, whatever ambiguity there might be in the recitals
that was dispelled by the unambiguous declaration made by the parties that the
property was given as security for the loan and the document was executed as a
mortgage. The gist of the document was not a letting of the premises, with a
rent reserved, but a mortgage of the premises with a small portion of the
income of it made payable to the plaintiff.
There is, therefore, no scope for the
argument in this case that the document is a lease and not a mortgage. We hold,
agreeing with the High Court, that the document is a mortgage and not a lease.
Even so, it was contended by the learned
Counsel for the appellant that the document did not create an usufructuary
mortgage but only an anomalous mortgage. This contention was raised as a
foundation to the argument that if the document was an anomalous mortgage, the
rights and liabilities of the parties would be governed by the terms of the
contract between them and not by the provisions of s. 76 of the Transfer of
Property Act. The question does not really fall to be decided in this case.
Whether the transaction is a usufructuary mortgage or an anomalous mortgage, in
the circumstances of the case, there will 1094 not be any difference in the
matter of rendition of accounts, for in the ultimate analysis, as we would
presently show, the true construction of the relevant terms of the document
would afford an answer to the question raised. We shall, therefore, proceed to
consider the question on the alternative basis.
If it was a usufructuary mortgage, it is
contended by the appellant that he was not liable to render accounts to the
mortgagor, as, Linder the mortgage deed, he was authorized to take the receipts
in lieu of interest within the meaning of s. 77 of the Transfer of Property
Act. The relevant provisions of the Transfer of Property Act are as follows:
"Section 76: When during the continuance
of the mortgage, the mortgagee takes possession of the mortgaged property,(g)he
must keep clear, full and accurate accounts of all sums received and spent by
him as mortgagee, and, at any time during the continuance of the mortgage, give
the mortgagor, at his request and cost, true copies of such accounts and of the
vouchers by which they are supported;
(h)his receipts from the mortgaged property,
or, where such property is personally occupied by him, a fair occupation-rent
in respect thereof, shall, after deducting the expenses properly incurred for
the management of the property and the collection of rents and profits and the
other expenses mentioned in clauses (c) and (d), and interest thereon, be
debited against him in reduction of the amount (if any) from time to time due
to him on account of interest and, so far as such receipts exceed any interest
due, in reduction or discharge of the mortgage-money the surplus, if any, shall
be paid to the mortgagor;
" Section 77: Nothing in section 76,
clauses (b), (d), (g) and (h), applies to cases where there is a contract
between the mortgagee and the mortgagor that the receipts from the mortgaged
property shall, so long as the mortgagee is in possession of the property, be taken
in lieu of interest on the principal money, or in lieu of such interest and
defined portions of the principal." 1095 Section 76(g) of the Transfer of
Property Act imposes a liability on a mortgagee to keep, full and accurate
accounts supported by vouchers. So too, he is under a statutory liability under
cl. 'h' to debit the nett receipts of the mortgaged property in deduction of
the amount due to him from time to time on account of interest and where such
receipts exceed any interest due, in reduction and discharge of the mortgage money
and to pay the surplus, if any, to the mortgagor. Therefore, every mortgagee in
possession is bound to keep clear, full and accurate accounts and to render the
accounts to the mortgagor in the manner prescribed in cl. 'h'. But s. 77 enacts
an exception to the mortgagee's liability under cls. (g) and (h) of s. 76.
Under that section (s. 77), if there is a
contract between the mortgagor and the mortgagee, whereunder it is agreed that
the receipts of the mortgaged property should, so long as the mortgagee is in
possession of the property, be taken in lieu of interest and a defined portion
of the principal, the mortgagee is freed from the statutory liability to keep
accounts or to render accounts to the mortgagor in the manner prescribed under
cls. (g) and (h) of s. 76 of the Act. This is so because, the receipts are set
off against the interest, and there is nothing to account for.
Therefore, to insist upon the mortgagee to
keep accounts or render accounts to the mortgagor would be an empty formality.
The essential condition for the application of this section is that the
receipts of the property should be taken in lieu of interest or in lieu of
interest and a defined portion of the principal. The contention of the learned
counsel for the respondents is that unless the contract authorizes the
mortgagee to take the entire receipts in lieu of interest or in lieu of
interest and defined portions of principal, this section cannot be invoked; for
it is said that the principle behind the section is that one is set off against
the other, with the result, there is nothing to be accounted for, whereas if
only a part of the receipts is agreed to be paid towards interest or in lieu of
such interest and defined portions of the"-principal, there would be
surplus in the hands of the mortgagee, which would have to be 1096 accounted
for. On the basis of that distinction, an argument is advanced to the effect
that, as in the present case, the mortgagee had to pay a sum of ]Is. 435-4-0 to
the mortgagor, he was not authorized by the mortgagor tinder the agreement to
take the entire receipts in lieu of interest, etc., within the meaning of s. 77
of the Transfer of Property Act. To put it differently, the argument is that
out of the receipts from the mortgaged property a portion was paid to the
mortgagor and the mortgagee was authorized to take only the balance in lieu of
interest and, therefore, there was no contract between the mortgagor and the
mortgagee for the latter taking the entire receipts in lieu of interest. We
find it difficult to accept this argument.
Under Exhibit A(3), the mortgagee undertook
an unconditional obligation to pay a sum of Rs. 435-4-0 in respect of the
property mortgaged to him. This obligation was not made to depend upon the
receipts from the property in the possession of the mortgagee. Whether there
was yield from the land or not, he had to make the payment to the mortgagor.
Though he had to pay the rent as a consideration for his enjoyment of the land
as a mortgagee, his liability did not depend upon the receipts from the land-he
had to pay, receipts or no receipts. His liability was also not confined to the
receipts, for he was under a personal obligation to pay the amount to the
mortgagor. On the other hand, the mortgagee was expressly authorized to take
the entire income from the land and appropriate the same towards interest and
the mortgagor agreed not to put forward any claim or demand in respect of any
increase in the produce. Shortly stated, the mortgagee was under a personal
obligation to pay Rs. 435-4-0 to the mortgagor and had a right to take the
entire receipts from the land in lieu of interest. It is not a case, therefore,
where receipts from the mortgaged property are divided between mortgagor and
mortgagee, but one where the mortgagee pays a specified amount to the mortgagor
and appropriates the entire receipts in lieu of interest. We, therefore, hold
that, under the mortgage deed, Exhibit A(3), there is a contract between the
1097 mortgagee and the mortgagor within the meaning of s. 77 of the Transfer of
Property Act, to the effect that the receipts from the mortgaged property
should be taken in lieu of interest.
Relying upon the judgment of the High Court,
a further attempt was made by the learned Counsel for the respondents to
contend that the mention of a specified rate of interest in the document is
indicative of the fact that under the document the mortgagee, would have to
take only such part of the net receipts sufficient to discharge the interest
and credit the balance to the mortgagor. The mere mention of a rate of interest
does not necessarily lead to the conclusion. The rate of interest may be
stipulated for estimating the amount payable towards interest so that the
parties may visualize whether the net receipts could reasonably be set off
against the interest. The rate may also be given for other reasons.
The Judicial Committee, in Pandit Bachchu Lal
v. Chaudhri Syed Mohammad Mah (1), held that notwithstanding the fact that a
particular rate of interest was mentioned in the mortgage deed, there was a
contract within the meaning of s. 77 of the Transfer of Property Act. It was a
case of a mortgage with possession and a particular rate of interest was
mentioned in the mortgage deed. There was a provision for repayment of the
principal either in whole or in part before the stipulated period, but it was
otherwise provided that the mortgagee should appropriate the surplus profits
towards interest, he having no claim to interest and the mortgagors having no
claim to the profits. The Privy Council held, on a construction of the mortgage
deed, that the said deed contained a contract within the meaning of s. 77 of
the Transfer of Property Act, 1882.
In Exhibit A-3, though the rate of interest
is stated at i per cent. per month, it was obviously mentioned to enable the
parties to approximately fix the amount to be appropriated by the mortgagee
from and out of the rent received from the thikadar. No doubt, the same rate of
interest is also mentioned when the (1) (1933) 37 C.W.N. 457.
1098 parties are dealing with their rights
after the expiry of the thikadari interest, but in more than one place they
have stated in clear and unambiguous terms that the mortgagee could appropriate
the produce towards interest and that the mortgagor would not put forward any
sort of claim or demand in respect of any increase in the produce. In view of
the clearly expressed intention of the parties, we cannot hold from the mere
fact that the rate of interest is mentioned that the document does not come
under the purview of s. 77 of the Transfer of Property Act. We hold that s. 77
of the Transfer of Property Act applies to the document and therefore the
mortgagee is not liable to render any account to the mortgagor.
On the footing that the mortgage is an
anomalous mortgage, we arrive at the same result. The learned Counsel for the
appellant contends that if the mortgage is an anomalous mortgage, the parties
are only governed by the provisions of s. 98 of the Transfer of Property Act
and not by the provisions of s. 77 of the Act. Section 98 says:
" In the case of an anomalous mortgage,
the rights and liabilities of the parties shall be determined by their contract
as evidenced in the mortgage-deed, and, so far as such contract does not
extend, by local usage.
The question whether this section excludes
the operation of other relevant provisions of the Act, including s.77, need not
be considered in this case, for, whether s.77 applies, as the learned Counsel for
the respondents contends, or the terms of the contract would govern the rights
of the parties, as the learned counsel for the appellant argues, the result
would be the same for the question to be decided is whether under the terms of
the mortgage, the mortgagee has the right to appropriate the entire net
receipts in lieu of interest,. We have already held that in Exhibit A(3) not
only there is such a recital but there is a specific term where under the
mortgagor expressly agreed not to claim any produce received by the mortgagee.
Whether s. 77 applies or not, under the express terms of the contract, 1099 the
appellant is not liable to render accounts for the excess receipts.
No other point is raised before us. In the
result, the decree of the High Court is set aside and that of the Subordinate
Judge is restored. The appellant will have his costs throughout.
Appeal allowed.
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