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Report No. 89

Chapter 35

Articles 61 To 67: Suits Relating To Immovable Property

35.1. Article 61.- article 61 Reads As Under:

"61. By a mortgagor-
(a) to redeem or recover possession of immovable property mortgaged;

Third years.

When the right to redeem or to recover possession accrues.
(b) to recover possession of immovable property mortgaged and after wards transferred by the mortgagee for a valuable consideration;

Twelve years.

When the transfer becomes know n to the plaintiff.
(c) to recover surplus collection received by the mortgagee after the mortgage has been satisfied.

Three years.

When the mortgagor re-enters on the mortgaged property.

This article replaced Articles 105, 134 and 148 of the Act of 1908, which were as follows:

"148. Against a mortgagee to redeem or to recover possession of immovable property mortgaged.

Sixty years.

When the right to redeem or to recover possession accrues; provided that all claim to redeem arising under instruments of mortgage of immovable property situate in Lower Burma which has been executed before the first day of May 1863, shall be governed by the rules of limitation in force in that State immediately before the same day.
134 To recover possession of immovable property conveyed or bequeathed in trust or mortgaged and after wards transferred by the trustee or mortgagee for a valuable consideration.

Twelve years.

When the transfer becomes known to the plaintiff.
105 By a mortgagor after the mortgage has been satisfied, to recover surplus collections received by the mortgagee.

Three years.

When the mortgagor re-enters on the mortgaged property."

The corresponding provisions in the Act of 1877 were Articles 148, 134 and 105, respectively.

35.2. Law Commission's Report.- The Law Commission recommended1 in its Report on the Act of 1908 that the period of limitation of 60 years allowed for the redemption of a mortgage in Article 148 of the Act of 1908 should be cut down to 12 years, on the analogy of the practice available in England. As regards Article 105, the Commission recommended the retention of the period, and, as regards Article 134, the Commission recommended that it should be split up in so far as it related to mortgages. However, all these articles were clubbed into one article and enacted as Article 61 in the Act of 1963, with the reduction of the period of limitation for redemption from 60 years to 30 years only.

1. Law Commission of India, 3rd Report (Limitation Act, 1908), paras. 48-49, 129-130.

35.3 Puisne mortgagee.- The Bombay High Court has held1 that a suit by a puisne mortgagee who had not been impleaded by a prior mortgagee and who sought to enforce his mortgage rights against his mortgagor was governed not by Article 132 of the Act of 1908 (now Article 62) but by Article 148.

The Calcutta High Court has held2 that where a prior mortgagee obtained a decree on his mortgage without impleading a puisne mortgagee, purchased the property in execution and entered into possession, a suit by the puisne mortgagee (who also purchased the property under his decree without impleading the mortgagee) for redemption and possession against the prior mortgage was governed by Article 132 of the Act of 1908 (now Article 62) and not by Article 148 (now Article 61).

A puisne mortgagee is an assignee of the equity of redemption and is, therefore, entitled to redeem a prior mortgage in Accordance with the provisions of sections 91 and 94 of the Transfer of Property Act which incorporate the familiar rule 'redeem up, foreclose down'. The distinction seems to be this. A suit to redeem is governed by Article 61. A suit to enforce payment falls within Article 62.

1. Nagu Tukaram v. Gopal Ganesh, AIR 1963 Born 405.

2. Nil Madhab v. Joy Gopal, AIR 1926 Cal 560.

35.4. Suit against transferee.- The Madras High Court has held1 by majority that Article 134 of the Act of 1908 (now Article 61) did not apply to a transfer from a trustee or mortgagee, where possession was not taken by the transferee. Wallis, C.J. and Coutts Trotter, ;J., however, dissented from the aforesaid (majority) view and held that the Article 134 applied to a transfer from a trustee or mortgagee under which possession was not taken by the transferee.

Wallis, C.J. further observed that it could not be held that the intention of the Legislature in enacting Article 134 was to make a provision in favour of the cestui que trust or mortgagor and give him a further period than he would otherwise have had. On the contrary, the intention was clearly restrictive.

The Indian Legislature must have been perfectly well aware that in the case of sales and mortgages alike, possession was rarely given on the date of transfer and if the legislature had intended the date of taking possession under the sale or mortgage to be the starting point, nothing would have been easier to say so. It had not done so, and it was not open to the judiciary to effect this by taking out of the article nearly, all the cases which would therefore fall within it.

However, it should be stated that most other High Courts have taken that view that Article 134 (now Article 61) does not apply where possession is not transferred.2-3 The Madras High Court has, in a later case,4 held that for the application of Article 61, it was not the intention or belief of the mortgagee who transferred the property that mattered, but the fact that, though he was a mortgagee, he, in fact, purported to transfer absolutely to a third party the property cowered by the mortgage in his favour. The fact of his belief that he was transferring some other property could not make any difference, so long as it was ultimately found that the property transferred by the mortgagee was the property which was the subject of the mortgage.

1. Mulla Vitti! Setti Kutti v. K.M.K. Kunhi Pathumma, AIR 1919 Mad 972: ILR 40 Mad 1040 (1054) (FB).

2. Narain Das v. Haji Abdur Rehim, 1920 ILR 47 Cal 866 (880).

3. Kalidas v. Sushila, AIR 1947 Cal 461.

4. Dhanalakshmi Animal v. G. Anthurai, AIR 1972 Mad 186.

35.5. No change needed.- In the post-1963 period Article 61 has not given rise to any serious controversy, and hence needs no amendment.

35.6. Article 62.- Article 62 reads as unde.-

"62. To enforce payment of money secured by a mortgage or otherwise charged upon immovable property. Twelve years. When the money sued for becomes due".

Article 132 of the Act of 1908 was as under-

"132. To enforce payment of money charged upon immovable property. Twelve years. When the money sued for becomes due.

Explanation.- For the purposes of this artic.-

(a) the allowance and fees respectively called malikhana and haqqs, and

(b) the value of any agricultural or other produce the right to receive which is secured by a charge upon immovable property, and

(c) advances secured by mortgage by deposit of title deeds shall be deemed to be money charged upon immovable property."1

Article 132 of the Act of 1877 was as under:

"132. To enforce payment of money charged upon immovable property. Three years. When the money sued for becomes due.

Explanation.- The allowance and fees respectively called malikhana and haqqs shall, for the purpose of this clause, be deemed to be money charged upon immovable property."

Article 132 of the Act of 1871 was in identical terms.

1. The Explanation does not appear in the present Act.

35.7. Law Commission Report.- Article 132 of the Limitation Acts of 1871, 1877 and 1908 provided for enforcing payment of money charged upon immovable property. Though the article did not specifically refer to mortgages, the Privy Council held1 that a suit on a simple mortgage bond to enforce payment was governed by Article 132. In the Report on the Act of 1908, the Law Commission recommended2 amendment of the article to extend it specifically to mortgages. The Commission also recommended deletion of clause (c) of the Explanation to the article.

In the present Act, not merely clause (c) of the Explanation, but the entire Explanation, has been omitted.

1. Vasudeva Mudaliar v. Srinivasa Pillai, 1907 ILR 30 Mad 426 (PC).

2. Law Commission of India, 3rd Report (Limitation Act, 1908), para. 128.

35.8. No change needed.- Controversies may, in practice, arise as to the applicability of the article to a particular case, where the exact nature of the bond may be in issue, but these do not necessitate any amendment of the article.

35.9. Article 63.- Article 63 reads as unde.-"63. By a mortgage.-

"63. By a mortgaged.

(a)

For foreclosure.

Three years.

When the money sued for becomes due.

(b)

For possession of immovable property mortgaged.

Twelves years.

When the mortgagee becomes entitled to possession."

The corresponding provisions in the Act of 1908 were Articles 135, 146 and 147, which read as under:-

"135. Suit instituted in a Court not established by Royal Charter by a mortgagee for possession immovable property mortgaged.

Twelve years.

When the mortgagor's right to possession determines.
146 Before a Court established by Royal Charter in the exercise of its ordinary original civil jurisdiction by a mortgagee to recover form the mortgagor the possession immovable property mortgaged.

Thirty years.

When any part of the principal or interest was last paid on account of the mortgage debt.
147 By a mortgagee for foreclosure or sale.

Sixty years.

When the money secure by the mortgage becomes due."

In the Act of 18777, Articles 135, 146 and 147 were in identical terms.

In the Act 1871, Article 135 an d139 contained the law on the topic in these terms:

"135. Suit instituted in a Court not established by Royal Charter by mortgagee for possession of immovable property mortgaged.

Twelve years.

When the mortgagee is first entitled to possession.
139 Like suit when the purchaser had after wards dispossessed.

Twelve years.

The date of the dispossession."

35.10. Law Commission's Report.- The Law Commission, in its Report on the Act of 1908, observed as under on the corresponding article of the Act of 19081:

"125. Before the decision of the Privy Council in Vasudeva v. Srinivasa, 1907 ILR 30 Mad 426 (433, 434) (PC), the view was taken that a suit by a mortgagee for sale of the property was governed by Article 147 which gives a period of 60 years for foreclosure or sale. This view is no longer tenable in view of the decision of the Privy Council, where it was pointed out that Article 147 applied only to an English mortgage under which the mortgagee has the alternative of either bringing a suit for foreclosure or for sale and that the proper article to apply in the case of a suit for sale under a simple mortgage was Article 132, which provides a period of 12 years from the date when the money sued for becomes due.

Under the existing law, the English mortgagee has no right of foreclosure. Like a simple mortgagee, he has to institute a suit for sale. Whether in view of the definition of English mortgage in the Transfer of Property Act he is entitled to recover possession also is a debatable point.

126. In the Limitation Act there are two Articles 135 and 146 which provide a period of limitation for recovery of possession by a mortgagee. If the suit is instituted, in a court not established by Royal Charter, the period is 12 years (Article 135) and if the suit is instituted in a court established by a Royal Charter the period is 30 years (Article 146). In the former case, time begins to run when the mortgagor's right to possession determines while, in the latter, time begins to run when the principal or interest was last paid on account of the mortgage debt.

It seems to be unnecessary to maintain this distinction, even assuming that under the present law the English mortgagee is entitled to recover possession of the property. The usufructuary mortgagee is undoubtedly entitled to recover possession of the property, either from the date of mortgage if possession is not delivered or, subsequently, if having been put in possession, his possession is disturbed. It would be sufficient, therefore, to provide only one article for a suit by a mortgagee for possession of immovable property mortgaged to him. A period of 12 years may be allowed. Time should run from the date when his right to possession accrues.

127. As, under an English mortgage, there is no right of foreclosure or sale in the alternative, Article 147 which in view of the Privy Council decision applies only to such mortgages, should be deleted. It is, however, necessary to make a fresh provision for a suit for foreclosure. A period of 12 years for such a suit may be provided, counting limitation from the date when the money secured by the mortgage becomes due, as in the case of a suit for sale."

The legislature has, however, inserted a period of thirty years, in conformity with the period prescribed in the new Act for suits for redemption of mortgages.

1. Law Commission of India, 3rd Report (Limitation Act, 1908), para. 125-127.



The Limitation Act, 1963 Back




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