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Des Raj Om Parkash Vs. Shankar Dass [1994] INSC 24 (13 January 1994)

Mohan, S. (J) Mohan, S. (J) Mukherjee M.K. (J)

CITATION: 1994 SCC Supl. (2) 585




1. The short facts relating to the civil appeal are as under:

2. The suit property was mortgaged by Respondent 1, Shankar Das with Budha Ram who is the father of defendants 1 to 4 (respondents 2 to 5 herein). The mortgage was for a sum of Rs 6000 and it was a usufructuary mortgage in relation to the shop covered by this appeal. Budha Ram leased out the shop in favour of Shankar Dass mortgagor- plaintiff. In other words, there was lease back in favour of the mortgagor. The mortgagor has subleased it in favour of the appellant Des Raj Om Parkash. The mortgagee obtained the decree against the mortgagor for eviction for non- payment of rent. That decree came to be executed. He took possession of the shop. At this stage, the appellant executed a rent-note in favour of the mortgagee. The mortgage came to be redeemed later on. Thereafter, the present suit came to be filed. The trial court and the court of first appeal held that the appellant would continue to be a tenant under the mortgage, as a whole, notwithstanding the rent-note executed by him. However, in the second appeal, the High Court reversed the findings and directed redemption and consequential possession. Hence, the present civil appeal.

3. The only point for our consideration is, whether the judgment of the High Court could be upheld. In attacking the findings therein, the learned counsel would seek to rely on two decisions i.e. All India Film Corpn. Ltd. v. Raja Gyan Nath1, Jadavji Purshottam v. Dhami Navnitbhai Amaratlal2. On the basis of those rulings it is urged, where the mortgagor has consented for the continuance of the tenancy of the appellant even after redemption, no eviction is possible at the instance of the mortgagor.

4. Yet another ruling is cited as Jagan Nath Piare Lal v. Mittar Sain3. It was held therein where a tenant of a mortgagor, after the mortgage, necessarily attorns to the mortgagee he becomes a tenant of the mortgagee. In such an event, unless his tenancy has been put to an end to by the mortgagor on the redemption of the mortgage, he again is relegated to his position of a tenant of the mortgagor.

This ruling also supports the contention of the appellant.

5. It is not possible for us to apply the case-law on the facts. In the case on hand, the factual finding as rendered by the High Court is as follows:

"Again Des Raj in his cross-examination admitted that the mortgagee had gone to the shop and took its possession in execution of the decree against the mortgagor. He, thereupon, executed the rent-note, Ex. PW 6/1 in favour of the mortgagee and started paying rent to him. It is thus established beyond doubt from the said rent-note and the statement of Des Raj that he was inducted as tenant by the mortgagor with effect from July 9, 1966 whereas the mortgage had been created in the year 1963. Mortgagor had taken on lease the shop from the mortgagee and in his capacity as tenant under the mortgagee he created the sublease in favour of Respondent

5. Even that sublease was terminated when the mortgagee successfully ejected the mortgagor from the shop in dispute under a decree of the Court. Thereafter, Des Raj was tenant under the mortgagee by virtue of the rentnote, Ex. PW 6/1." 1 (1969) 3 SCC 79: (1970) 2 SCR 581 2 (1987) 4 SCC 223 3 AIR 1970 P&H 104 587

6. In view of this factual situation, whatever rights the appellant had under the original mortgage as subtenant when the mortgagor held the property under enjoyment on a lease back that right came to an end upon execution of the decree by the mortgagee. The said mortgagee recovered possession in execution proceedings. Thereafter new rights as lessor and lessee came into existence between the appellant and the mortgagee, by reason of the execution of rentnote Ex. PW 6/1. Hence, this is a case in which the conclusion is inescapable upon the redemption of the mortgage, the rights of the appellant tenant vis-a-vis the mortgagor came to an end. Hence, neither All India Film Corpn. Ltd. case1 nor Jadavji Purshottam case2 will have any application into the facts of this case.

7. Nor again, Jagan Nath Piare Lal case3 will advance the case of the appellant. On facts, that case could be distinguished. The relevant facts of the ruling are as found in paragraph 13 which are as under:

"13. So far as the facts of the present case are concerned, the tenant was the tenant of the mortgagor. After the mortgage, he continued to be the tenant of the mortgagee.

There was no surrender by him of the tenancy he held under the mortgagor. All that happened was that he executed a fresh rent- note and agreed to pay 50 naye paise per mensem over and above the rent he was paying to the mortgagor. There is no other evidence on the record which will indicate that he gave up the tenancy under the mortgagor and took up a new tenancy under the mortgagee. In this situation, it is not possible to hold that there was a surrender by tenant of his tenancy under the mortgagor. In order to hold that a tenant has surrendered his existing lease, it must be shown that the earlier tenancy was put to an end to and a new tenancy was created.

The mere fact, that the same tenant has continued as a tenant of the property and has only executed the fresh rent-note in favour of the mortgagee, will not automatically amount to surrender."

8. Accordingly, we conclude that the appeal is without merit and is dismissed. No costs.


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