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Report No. 70

57.31. Reasonable notice.-

The present section, while laying down a rigid rule, allows a provision for reasonable notice. It is not very clear whether the section contemplates that the clause in the mortgage deed itself should be framed so as to use the words "reasonable notice" or words; substantially to that effect or, whether it is sufficient if a duration is fixed for the notice that would be valid if the duration is reasonable in the circumstances.

The latter seems to be a sensible construction, since what the fourth paragraph seeks to furnish is a test for determining how far such provisions are valid. It is for the parties, then to choose the duration and for the court to determine whether it is reasonable. But it is not necessary that the parties must use in the provision the words "reasonable notice".

It is obvious that if the notice period is regarded as unreasonable, then, it is taken out of the savings incorporated in the fourth paragraph and would be hit, speaking generally, by the peremptory provision in the first paragraph of the section which does not make any exception for a contract to the contrary.

57.32. Recommendation.-

Case law on the section would show that a conflict of views has arisen on the question whether a provision for redemption only in a particular month or season of the year is valid. Within the same High Court, different views seem to have been taken.1-2 While no hard and fast rule can be laid down, practical considerations render it desirable that a clarification should be inserted to the effect that the mere fact the provision prohibits redemption except on certain days or during a certain period, shall not render it invalid, if the provision is reasonable in the circumstances.

No hardship would be caused by such a provision, since the non-compliance therewith would not be a bar to a suit for redemption. The mortgagee will be entitled to interest for the relevant period, i.e., the period by which the notice actually given to the mortgagee falls short of the reasonable notice.3

We recommend that the fourth paragraph may be amplified as above, and opportunity may also be taken of making it clear by a suitable amendment that what is intended is a notice period which is reasonable in the circumstances, and not ritualistic repetition of the words "reasonable notice".4

1. Govinda Menon v. Chatu Menon, AIR 1914 Mad 563 (invalid)-contrasted with Kadir Ribi v. Mallappa Pillai, AIR 1946 Mad 542 (544) (valid).

2. AIR 1917 Oudh 123 (124) (valid)-contrasted with AIR 1919 Oudh 385 (386) (invalid).

3. Nadir Shaw v. Shrinivi, AIR 1924 Born 264.

4. This is not draft.

57.33. Section 60, last paragraph.-

The last paragraph of section 60 provides that nothing in this section shall entitle a person interested in a share only of the mortgaged property to redeem his own share only on payment of a proportionate part of the amount remaining due on the mortgage, except only where a mortgagee, or, if there are more mortgagees than one all such mortgagees, has or have acquired, in whole or in part, the share of a mortgagor.

In so far as the paragraph goes it is unexceptionable, but there seems to be some obscurity resulting from the incompleteness of the language of the section on a few points. We shall first deal with the principle of this paragraph and its general scope, after which the specific problems that have arisen so far will be discussed.

57.34. Principle.-

The principle of the paragraph is clear enough. The mortgage security is indivisible and partial redemption is not allowed. A part-owner of the interest of the mortgagor can certainly redeem the whole mortgage, but cannot redeem his share only. The reason for this rule is that disintegration of the mortgage security would result in great injustice to the mortgagee.1 In the leading Privy Council case,2 on the subject, the rationale was thus explained:

"It would put him (the mortgagee) to a separate suit against each purchaser of fragment of the equity of redemption, though purchasing without his consent, and he would have separate suits against each of them, and suits in which no one of the parties would be bound by anything which took place in a suit against another. Different proportions of value might be struck in the different suits and the utmost confusion and embarrassment would be created."

1. Mulla, (1973), p. 437.

2. Nilkantha v. Suresh Chandra, 1886 ILR 12 Cal 414 (PC).

57.35. Previous provision.-

Since the law attaches the greatest importance to this principle, there is a categorical provision prohibiting disintegration. As is obvious from the word "only" now appearing in the section the exception thereto is a very limited one. There is, of course, nothing to prevent one co-owner from redeeming the entire property. But he cannot, in general, claim to redeem his own share. This aspect does not appear to have caused much controversy in England in recent judicial decisions. The law in England is substantially the same as in India.

57.36. Exception in the last paragraph.-

The exception which forms the latter half of the last paragraph of section 60 has given rise to certain controversies. The exception relates to the case where a mortgagee has acquired the share of the mortgagor-for simplicity, we are leaving out certain refinements also dealt with in the paragraph. Where a mortgagee acquires the whole of the mortgaged property, there is of course, a merger of the two interests and the case falls within the proviso to the first paragraph of the section, namely, extention of the right of redemption by act of the parties.

Even where the merger takes place by operation of law, the principle will be the same. But where the mortgage acquires a part of the mortgaged property, the mortgage is not extinguished in its entirety, but only pro tanto in respect of that part. This consequence is, of course, not confined to mortgages, but may apply to many other rights where the person owing the right and the person against whom the right is enforceable become the same.1 In regard to mortgages, on such partial acquisition the first provision that comes into play is section 82, under which mortgaged properties are bound to contribute rateably to the debt.2

As a consequence of this section providing for contribution, the other properties are liable only for the balance of the mortgage debt.3 But the more relevant consequence of such partial acquisition is the breaking-up of the integrity of the mortgage. The general rule is that the security is indivisible.4 To this there is an exception under the exception to the last paragraph.

Its effect, when read with the first part, is that "a person interested in a share only of the mortgaged property", would then become entitled "to redeem his own share only, on payment of a proportionate part of the amount remaining due on the mortgage". The negative or prohibitory provision becomes inapplicable where the exception applies and the positive or permissive aspect of it takes charge.

1. Kudhai v. Sheo Dayal, 1888 ILR 10 All 570 (574, 576) (Mahmood, J.).

2. Bisheshur Dayal v. Ram Sarup, 1900 ILR 22 All 284 (289-291) (review cases).

3. L. Sankaran v. Adima Kunja, AIR 1965 Ker 132 (134), para. 11.

4. Amba Prasad v. Hoonga Ram, AIR 1930 All 523 (524).

57.37. Controversy.-

There is, in fact, no controversy on the proposition put forth above, namely, that where the mortgagee acquires the share of one mortgagor, the remaining mortgagor is entitled to sue for partial redemption. Controversy, however, has arisen on the question whether, in the case falling within the exception, one mortgagor may redeem the whole of the residue of the mortgage without the consent of the mortgagee. Some High Courts have taken the view that he is not entitled to redeem more than his share. To this group belong the High Courts of Allahabad,1 Calcutta2 and Madras.3

Certain other High Courts took the contrary view, namely, that a sharer in the mortgaged property, in the circumstances where the exception applies, is under section 60 entitled to redeem all the shares other than that purchased by the mortgagee. To this group belong the High Courts of Bombay,4 Orissa5 and Punjab.6

1. Amba Parsad v. Hoonga Ram, AIR 1930 All 523 (524).

2. Rakhal Chandra v. Tara, (1965) 69 Cal WN 688 (692).

3. Narayan Swami v. Perumal, AIR 1953 Mad 720 (721).

4. Hirabai v. Dinshah, AIR 1926 Born 303.

5. Chandu Agasti v. Chandra. Bala, AIR 1965 Ori 63 (65).

6. Pala Singh v. Attar Singh, AIR 1954 Punj 81 (83).

57.38. Statutory provisions.-

Let us examine the statutory provisions in this regard, before dealing with the very difficult question as to what view ought to be adopted. The first thing to be noted, as has been pointed out by Mulla,1 is that the right of the mortgagor of a share to redeem the whole is recognised in sections 91 and 95 and it is difficult to see why the acquisition by the mortgagee of a part of the property should affect that right as to the rest of the proportion.

The owner of a share (in the residue) is, to quote Piggot J.2 "entitled on the strength of his position as for owner of the mortgaged property to redeem just as much of it as does not belong to the mortgagees themselves and he is entitled to do so on payment of a proportionate share of the mortgage debt.9 This is all that the section in the last paragraph, Exception, was intended to lay down. That exception was not intended to affect the principle already recognised, giving a right to one co-sharer to redeem the whole of the subsisting mortgage. The ordinary right of any sharer in respect of the property is to redeem the whole of the balance of the debt.3

This is the general rule laid down in section 91, which was previously recognised by the Privy Council.4 Where the Exception applies, the additional effect is to confer a right of partial redemption. In this sense, a suit for partial redemption, where permissible, is a combination of a suit for redemption and a suit for contribution. Mulla5 has been at pains to point out that after the acquisition of a share of the property by the mortgagee, the normal right of a sharer in the residue is to redeem the whole residue and his right under the exception in this section is to redeem his own share only in that residue.

1. Mulla, (1973), p. 445.

2. Shyam Saran v. Banarsi Das, AIR 1922 All 192.

3. Mulla, (1973), p. 442, under "Suit for partial Redemption".

4. Narinder Narain v. Dwarkalal Mudu, 1877 ILR 3 Cal 397.

5. Mulla, (1973), p. 443.

57.39. Origin of the controversy.-

How, then, has the controversy arisen on the subject? It would appear that primarily the controversy has arisen because of a difference of opinion as to the proper reading of certain decisions of the Privy Council. The case of Nawab Azimat Ali1-a case decided before the Act recognised the right of partial redemption in case of acquisition by the mortgagm Apparently, the Privy Council also held that the sharer cannot redeem the whole of the residue without the consent of the mortgagee.2 Then there is the later decision of the Privy Council

In Mirza Yadalli Beg v. Tukaram, AIR 1921 PC 125, the mortgagee had foreclosed nine villages in that case, without making the purchaser in the equity of redemption of one village, a party. This purchaser now sued to redeem the whole mortgage. The contention of the mortgagee was that the purchaser was entitled to redeem only his own village. The Privy Council held that, he was entitled to redeem the nine villages.

The case was of imperfect foreclosure and, therefore, the mortgagee had not acquired a complete title to any part of the equity of redemption; and so, the whole mortgage was regarded as open to redemption.3 Controversy has arisen whether the judgment in Mirza Yadalli Beg's case has over-ruled the earlier judgment in Nawab Azimat Ali's case. The existence of this controversy is obvious from the discussion contained in a few judgments4-6 of the High Courts.

1. Nawab Azimat Ali v. Jowahir Singh, (1870) 30 MIA 404 (407, 415) (PC).

2. Mulla, (1973), p. 444.

3. Mulla, (1973), p. 444.

4. Promotha Nath v. Ram Kissun, AIR 1927 Pat 25.

5. AIR 1965 Ori 64 (65).

6. AIR 1968 Born 106 (110).

57.40. Recommendation.-

Recent decisions would show that the controversy is still continuing.1-2 To solve the controversy, we recommend addition of an Explanation as follows:-

1. AIR 1965 Ker 132.

2. AIR 1956 Mad 293.


(to be added to section 60 at the end)

"Nothing in this section shall be deemed to affect the right of a person interested in a share only of the mortgaged property to redeem, by virtue of section 91, the entire mortgaged property or so much thereof as still remains subject to mortgage".

57.41. Accession.-

We may conclude our discussion of section 60 with a brief mention of accessions to mortgaged property. The subject of accession to the mortgaged property has several aspects, of which we are concerned with one at the moment. When the mortgaged property has received an accession after the mortgage, then, assuming that the accession forms part of the mortgage security by virtue of the specific provisions contained in the Act in that regard, such as, sections 63, 64 and 72, is the mortgagee, within the meaning of section 60, first paragraph, bound to re-deliver and re-transfer the accession also?

That is the question with which we are concerned. On principle, it will appear that the answer should be in the affirmative. Perhaps, an express amendment in this regard is not necessary, having regard to the fact that no controversy has so far arisen.

An accession is not defined in the Act but one species is illustrated in section 63, which provides that where mortgaged property in possession of the mortgagee has, during the continuance of the mortgage, received any accession, the mortgagor, upon redemption shall, in the absence of a contract to the contrary, be entitled as against the mortgagee to such accession. This section is based on the principle that the increase follows the principal-a principle stated in the Latin maxim accessio credit principle.1 The concept was familiar to the Roman law, which had elaborate rules on the subject. The rules evolved show a highly sophisticated body of juristic doctrines.

Accession may be natural or artificial, and may be corporeal or incorporeal. It would appear that whatever be the nature of the accession, delivery thereof to the mortgagor by the mortgagee is mandatory, subject to specific provisions contained in the Act.2

1. Sheo Pujan v. Bhagwati Dubey, AIR 1949 Pat 99.

2. Section 63, 64, 70.

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