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1987 (12) TMI 326 - SC - Indian Laws

Issues:
1. Whether a tenant of a mortgagee can continue as a tenant after redemption of the mortgage decree until evicted in accordance with the Rajasthan Premises (Control of Rent and Eviction) Act, 1950.
2. Whether the tenancy created in favor of the appellant can be considered an act of ordinary prudence under Section 76A of the Transfer of Property Act.

Analysis:

Issue 1:
The case involved the redemption of a mortgage where the mortgagor sought vacant possession of the shop from the mortgagees, including the tenant-appellant. The tenant argued that the tenancy could not be terminated as per the Rajasthan Rent Control Act. The executing court initially held that the tenancy could not continue after the mortgage redemption, dismissing the tenant's application. However, the Civil Appeal No. 13 of 1970 allowed the appeal, emphasizing that the tenant's interest subsists post-redemption until eviction under the Rent Control Act.

The respondent filed a second appeal, which the High Court allowed, granting one year for possession delivery. The Supreme Court considered similar issues in Mahabir Gope v. Harbans Narain Singh, emphasizing that a mortgagee cannot create interests beyond their tenure, and leases must end at redemption unless a new relationship is established. The Court also cited Harihar Prasad Singh v. Munshi Nath Prasad, highlighting that leases by mortgagees must align with prudent property management.

The Court affirmed the High Court's decision, stating that the tenant's lease did not survive mortgage redemption. The Full Bench of the Rajasthan High Court's decision was also supported, denying tenant protection under the Rent Act post-redemption. The Court concluded that the tenant's lease was not a prudent act and upheld the High Court's judgment for possession recovery by the mortgagor-landlord.

Issue 2:
The second issue revolved around whether the tenancy created by the mortgagee was an act of ordinary prudence under Section 76A of the Transfer of Property Act. The Court referred to various precedents such as Asa Ram v. Mst. Ram Kali, emphasizing that leases by mortgagees must align with prudent property management practices to be binding post-redemption. The Court also cited Om Parkash Garg v. Ganga Sahai, where a lease was deemed imprudent and terminated upon mortgage redemption.

The Court concluded that the lease by the mortgagee was not an act of prudent management, leading to its termination post-mortgage redemption. The decision aligned with previous rulings and upheld the High Court's judgment for possession recovery by the mortgagor-landlord. The appeal was dismissed, with no order as to costs.

In summary, the Supreme Court affirmed that the tenant's lease did not survive mortgage redemption and that the lease was not an act of prudent management, leading to the dismissal of the appeal and granting possession recovery to the mortgagor-landlord.

 

 

 

 

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