MAHANT RAMDHAN PURI versus BANKEY BIHARI SARAN & OTHERS

Citation: [1959] 1 S.C.R. 1085 · Decided: 23-05-1958 · Supreme Court of India · Bench: VIVIAN BOSE · Disposal: Appeal(s) allowed

Judgment (excerpt)

I 
S.O.R. 
SUPREME COURT REPORTS 
1085 
MAHANT RAMDHAN PURI 
v. 
BANKEY BIHARI SARAN & OTHERS 
(GAJENDRAGADKAR, A. K. SARKAR, SuBBA RAo 
and VIVIAN BOSE JJ.) 
Deed, constri;ction of-Mortgage or lease-Accounts-Mort-
gagee, if bound to render account-Transfer of Property Act (IV of 
I882), SS. 76 and 77. 
D executed a document in favour of M hypothecating an 
eight annas share in a village for the purpose of discharging a 
debt of Rs. 29>496 payable by him to M. 
In respect of this pro-
perty there was a pre-existing thika in favour of J for a period 
of 9 years, under which D took Rs. 2,205 as peshgi money with-
out interest and the annual rent was fixed at Rs. 2,205. 
The 
document provided that (i) interest at ~ per cent. per month 
was payable on the sum of Rs. 29>496; 
(ii) during the 
subsistence of the thika M would receive the rent from J 
and appropriate Rs. l,769-12-0 towards interest and pay 
Rs. 435-4-0 as rent to D; (iii) after 'the expiry of the thika 
M would take physical possession of the land and appropriate 
the produce towards interest and pay Rs. 435-4-0 as rent 
to D; (iv) on the expiry of the thika M would repay the 
peshgi amount of 
l~s. 2,205 to J and this sum was added to 
principal amount due ; (v) on the expiry of 15 years, or after the 
extended period, D would repay the entire principal amount; 
(vi) and the property was given as security for the amount pay-
able by D. 
The respondents who are successors of D instituted 
a suit for redemption on the basis that the transaction was a 
usufructuary mortgage, for rendition of accounts and for re-
covery of surplus profits. The appellant, successor of M, con-
tended that the suit for redemption was not maintainable as the 
transaction was not a mortgage but a lease, and that even if it 
was a mortgage there was no statutory liability to render 
accounts as the document provided that the receipts were to be 
taken in lieu of interest and the case was governed by s. 77, 
Transfer of Property Act : 
Held, that the transaction was a mortgage and not a lease. 
The guiding rule of construction is that the intention of the 
parties must be looked into and that once there is debt with 
security of land for its redemption the arrangement is a mort-
gage by whatever name it is called. 
Held, further, that there was a contract between. the mort-
gagor and the mortgagee within the meaning of s. 77, Transfer 
of Property Act to the effect that the receipts from the mort-
• 
gaged property be taken in lieu of interest ari.d consequently the 
mortgagee was :10t liable to render accounts. The stipulation 
... 
May 23. 
• 
1086 
SUPREME COURT REPORTS 
[1959] 
'958 
in the document for paym~nt of Rs. 435-4-0 to the mortgagor 
was a personal obligation of the mortgagee and he had a right to 
Mahant 
take the entire receipts from the land in lieu of interest. Though 
Ramdhan Puri 
the rate of interest is stated as 
~- per cent. per month it was 
v. 
mentioned to enable the parties to approximately fix the 
Bank'y 
amount to be appropriated by the mortgagee from and out of 
Bihari Saran 
the rent received frorn the thikadar. 
The mere fact of the 
mention of the rate of interest could not make s. 77 inapplicable 
in view of the clearly expressed intention of the parties. 
Subba Rao }. 
• 
Pandit Bachchu Lal v. Chaudhri Syed Mohammad Mah, (1933) 
37 C. W. N. 457, referred to. 
CIVIL APPELLATE JURISDICTION: 
Civil Appeal No. 
239 of 1954. 
Appeal from the judgment and decree dated Decem-
ber 12, 1950, of the Patna High Court in Appeal from 
Original Decree No. 188 of 1945 arising out of the 
judgment and decree dated December 18, 1945, of the 
Court of the Additional Subordinate Judge, IV Class, 
Gaya, in Title Suit No. 4 of 1945. 
Purshottam 'l.'ricumdas and S. P. Varma, for the 
appellant. 
• 
S. P. Sinha and R. C. Prasad, for respondents 
Nos. 1-4, 8-10, 13 and 14. 
1958. May 23. The Judgment of the Court was 
delivered by 
SUBBA RAO J.-This appeal by certificate under 
Art. 133 (1) (a) of the Constitution of India is directed 
against the judgment and decree of the High Court of 
Judicature at Patna setting aside those of the Sub-
ordinate J·udge, Ga ya, in a suit for. redemption of an 
usufructuary mortgage. 
Deokinand, the common ancestor of plaintiff-respon-
dents l to 4 and proforma respondents 6 to 12, execut-
ed a document dated August 20, 1923, in favour of 
Mahant Tokhnarain Puri of Nadra, the predecessor-in-
interest of defendant l, hypothecating eight 

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