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TMI Blog2000 (11) TMI 1247X X X X Extracts X X X X X X X X Extracts X X X X ..... dance with Rule 95 of Order 21 of the Code of Civil Procedure or would be entitled to only symbolic (constructive) possession, as provided in Rule 86 of Order 21 of the Code. 3. More than 72 years ago, to be exact, on 6-2-1928 the property bearing Nos. 391 to 399, 405 and 406, Chandni Chowk, Delhi were mortgaged with possession by Ganga Ram in favor of Ram Chand, Bengali Mal, Shyam Lal and Chote Lal for ₹ 80,000/-. On the same day Ganga Ram executed a leased deed in favor of the mortgagees agreeing to pay ₹ 650/- p.m. as rent for the property. Another charge was created against the same properly when on 13-7-1928, another mortgage deed was executed by Ganga Ram in favor of the aforementioned mortgagees to secure ₹ 25,000/-. By the third deed of mortgage dated 19-7-1928 for ₹ 45,000/- in addition to the already secured property another properly, namely House No. 412, Chandni Chowk, Delhi was mortgaged with possession and on the same day, a lease deed with respect to the same property was executed by the mortgagor in favor of the mortgagee agreeing to pay rent @ ₹ 32/- p.m. 4. The mortgagees on 23-12-1930 filed suit No. 109/30 to enforce their righ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to have a property over the mortgage of defendant No. 2. We need not state the other facts since the same are not relevant for the purpose of deciding the controversy arising before us except by staling that the decree of Lahore High Court was in terms of the compromise dated 27-2-1931 followed by decree dated 28-4-1931. As the mortgagor failed to pay, the amount due from him to the mortgagees, as adjudicated upon in the preliminary decree and as found by Lahore High Court, proceedings for final decree were initiated. Ultimately, final decree came to be passed on 23-5-1940 enabling and authorising the mortgagees to realise an amount of ₹ 2,10,076-13-10, which was due on 6-1-1936 together with interest @ 9% p.a. by sale of the mortgaged property, further directing that the money realised on sale, after deduction of the expenses shall be applied in payment of the amount payable to the mortgagees under the preliminary decree. 7. In order to reap the fruits under the final decree, the mortgagee-decree holders on 1-4-1952 filed an execution application praying that the mortgaged property be ordered to be sold for realisation of the amount of decree and on realisation, the amou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt comes to the conclusion that the applicants are not entitled to vacant physical possession of any particular part of the property, symbolic possession of that parent of the property be granted to them. iii. Symbolic possession of the part of the property in occupation of tenants referred to in para 18 above and shown as green in the plan Annexure 'B' be granted to the applicants. iv. Such other or further relief as the Hon'ble Court deems proper in the circumstances of the case, be also granted to the applicants. 9. The tenants in the property on being served with the application of the auction purchasers filed objections and thereby resisted the prayer for delivery of vacant possession. The objectors alleged that they cannot be dispossessed from the property in execution proceedings under Rule 95 of Order 21 of the Code as they are not in occupation of various portions of the property on behalf of the judgment debtor mortgagor, but were in occupation of the same as tenants. They pleaded that they were prepared to attorn in favor of the auction purchaser and were agreeable only for symbolic possession of the property to be delivered to the auction pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd purposes amounted to the mortgagor consent that the leases would be binding on him after redemption. The mortgagor knew that if he did not pay the decretal amount within a period of two and a half months, the arrangement would continue and in fact it proved to be a long arrangement and thus the mortgagor was held to have concurred in it. 12. Feeling aggrieved against the decision of learned Single Judge, instant appeal was preferred by the auction purchaser on 19-5-1977 and against some of the findings in the impugned judgment, cross-objections were filed by the respondents on 27-5-1977. The appeal came up for hearing before Division Bench on 20-3-1987. During course of hearing, the following question of law was framed for being referred to a larger Bench:-- Whether a tenant inducted by the mortgagee in possession can claim the benefit of protection offered by the Rent Control Legislation after redemption of the mortgage. 13. The Full Bench on 11-9-1987 answered the reference holding that the tenant inducted by a mortgagee in possession cannot claim the benefit of the protection offered by the Rent Control Legislation after the redemption of mortgage, unless the mo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order to realise the amount, which had become due and payable and was not paid by the mortgagor, an application was filed by the mortgagee decree holders so as to execute the decree. Prayer was made for sale of the mortgaged property. In the said execution, warrant of sale was issued on 21-7-1970 and the public auction was held on 25-9-1970. Sale in favor of the appellant was confirmed and the sale certificate (Exhibit A-PW/1) was Issued on 22-8-1972. 17. M/s Puran Chand and Co., the appellant is thus the auction purchaser. They were not parties to Suit No. 109/30 in which preliminary decree was passed or the proceedings in which final decree was passed. They are outsiders to the suit. They are also outsiders to the decree in execution of which the property was put to sale. Similarly the respondents also were not parties to the suit or to the decree like the appellants. The mortgagor and the mortgagees are not now in picture. The appellant is the auction purchaser. The respondents are the persons in occupation of the property, claiming to be tenants. Admittedly, the respondents were in possession of the property prior to the date of issuance of warrant of sale and obviously prio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on purchaser, since auction purchasers will be deemed to have purchased the property subject to tenancies, it was further contended that the appellants at the most will be entitled to symbolic possession. The question whether the auction purchaser will be bound by the tenancies created by mortgagees or whether the tenants are otherwise entitled to continue in occupation being old tenants, will have to be adjudicated in some other proceedings and not in these proceedings. 20. Having considered the submissions made at the Bar, we are of the view that the question formulated by us has to be answered on the basis of and making reference to the date of acquiring title by the auction-purchaser, which is most crucial and a decisive factor. The auction-purchaser came into picture only after warrant of sale had been issued. They appeared on the scene when they offered their bid at the auction, which admittedly took place on 25-9-1970 and on which date they were declared to be the highest bidders. To the auction, objections were raised. It will also be necessary to make reference to the nature of the objections and the pleas taken therein by the appellants. Shri Dalak Ram Jain and Smt. Me ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... property in occupancy of tenant.-- Where the property sold is in the occupancy of a tenant or other person entitled to occupy the same and a certificate in respect thereof has been granted under Rule 94, the Court shall, on the application of the purchaser, order delivery to be made by affixing a copy of the certificate of sale in some conspicuous place on the property, and proclaiming to the occupant by beat of drum or other customary mode, at some convenient place, that the interest of the judgment-debtor has been transferred to the purchaser. 23. The appellant-auction-purchaser did move an application both under Rules 95 and 96, C.P.C. of Order 21 of the Code claiming physical and vacant possession of that part of the property, which was in occupation of the persons, who had been inducted by the mortgagees on or after 1-3-1931, which portion is shown in red in the plan (Annexure-B) and symbolic possession with respect to that part of the property in occupation of tenants, who were in continuous possession of the property prior to 1-3-1931, shown as green in the plan (Annexure-B). The auction-purchaser claimed that the tenancies, if any, created by the mortgagees from time ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ke a similar provision in relation to a usufructuary mortgage or for a mortgagee in possession. The binding nature of the lease made by the mortgagor to be binding on the mortgagee is in case of a simple mortgage. Transfer of Property Act maintains a clear distinction. While it binds the mortgagee with a lease created by a mortgagor, it does not make the lease made by mortgagee binding on the mortgagor to which Section 76 applies. He urged that Dev Raj Dogra's case (supra) was a case of simple mortgage. In that case, the aspect of lease created by mortgagee in a usufructuary mortgage was not considered. For that reason alone in Dev Raj Dogra's case (supra), it was observed that the decisions in All India Films Corporation's case and Sachalmal Parasram v. Ratnabal , AIR1972SC637 are not applicable. He even tried to persuade us by making further submission that the rule laid down in All India Films Corporation's case alone will have to be applied to the facts of the instant case and not that which has been laid down in Dev Raj Dogra's case since in Dev Raj Dogra's case, attention of their Lordships was not invited to the amendment to the Explanation to Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion was answered holding :-- A general proposition of law is that no person can confer on another a better title than he himself has. A mortgage is a transfer of an interest in specific immovable property for the purpose of securing repayment of a loan. A mortgagee's interest lasts only as long as the mortgage has not been paid off. Therefore bn redemption of the mortgage the title of the mortgagee conies to an end. A derivative title from him must ordinarily come to an end with the termination of the mortgagee's title. The mortgagee by creating a tenancy becomes the Lesser of the property but his interest as Lesser is conterminous with his mortgagee interest. Section 111(c) of the Transfer of Property Act provides that a lease of immovable property determines where the interest of the Lesser in the property terminates on, or his power to dispose of the same, extends only to the happening of any event by the happening of such event. The duration of the mortgagee's interest determines his position as the lessor. The relationship of Lesser and lessee cannot subsist beyond the mortgagee's interest unless the relationship is agreed to by the mortgagor or a fresh re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in possession, who had created leases have prayed the Court for being put in actual possession of the property after dispossessing the tenants Inducted by him, more particularly in execution proceedings? The answer obviously will have to be in negative. 30. What the auction-purchasers are insisting for is the actual delivery for possession pursuant to the auction sale in their favour, which was conducted on issuance of warrant of possession in order to realise the mortgage debt. In All India Films Corporation's case (supra), the auction-purchaser Raja Gian Nath had filed a separate suit for recovery of possession of the property against various occupants. We have given our due consideration to the submissions made at the Bar and are not persuaded to take a different view than the one which was taken in Dev Raj Dogra's case (supra). 31. The principal question that had arisen in Dev Raj Dogra's case (supra) was that whether an auction-purchaser, who was not a party to the suit would be entitled to recover actual physical possession of the portions of property purchased by him in auction from the persons in occupation claiming to be lessees in an application made by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In Dev Raj Dogra's case (supra), the Apex Court also considered the applicability of Section 52 and S. G5-A of the Transfer of Property Act and held (at page 990) :-- It may be true that Section 52 and Section 65-A of the Transfer of Property Act operate in different spheres. Section 65-A, as we have earlier noticed, deals with the powers of the mortgagor to grant a lease of the mortgaged property, while the mortgagor remains in lawful possession of the same. Section 52 deals with cases of transfer of or otherwise dealing with any immovable property after any suit or proceeding in which any right to the said immovable property is directly and specifically in question, has been filed. It is also to be noted that Section 65-A which came to be inserted by the Amending Act, 1929, is neither made 'subject to' nor 'notwithstanding the provisions' contained in Section 52 of the Act. Section 52 will, however, be only applicable, if the requirements of the said section are satisfied. The said requirement being;-- (1) A suit or a proceeding in which any right to immovable property must be directly and specifically in question, must be pending. (2) The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ctual transfers of rights which are subject-matter of litigation but to other dealings with it 'by any party to the suit or proceeding, so as to affect the right of any other party thereto'. Hence, it could be urged that where it is not a party to the litigation but an outside agency, such as the tax collecting authorities of the Government, which proceeds against the subject-matter of litigation, without anything done by a litigating party, the resulting transaction will not be hit by Section 52. Again, where all the parties which could be affected by a pending litigation are themselves parties to a transfer or dealings with property in such a way that they cannot resile from or disown the transaction impugned before the Court dealing with the litigation, the Court may bind them to their own acts. All these are matters which the Court could have properly considered. The purpose of Section 52 of the Transfer of Property Act is not to defeat any just and equitable claim but only to subject them to the authority of the Court which is dealing with the property to which claims are put forward. 35. In the instant proceedings, the appellant-auction purchaser being an outsid ..... X X X X Extracts X X X X X X X X Extracts X X X X
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