LexPUZHAKKAL KUTTAPPU versus C. BHARGAVI AND OTHERS
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696 A PUZHAKKAL KUTTAPPU v. C. BHARGA VI AND OTHERS September 22. 1976 B [Y. V. CHANDRACHUD, P. K. GOSWAMI AND A. C. GUPTA, JJ.J c D E G H Interpretario11-·Document whether mortgage or lease deed-Te.~ts for deter- mination of. By a registered deed described as "otti deed" the otti right in a piece of land had been transferred in 1894 to the predecessors-in-interest of the appellant and of the respondents by the janmi for a period of 72 years for a certain consideration. The document recited various debts in respect of wet lands, the debt owed by the executants and cash received from the transferee on that date. Possession of the land was made over to the transferee giving him the right to enjoy the land. The other terms of the deed were that the transferee was required to appropriate the income of the property to the interest on the amount -advanced, to pay land revenue; and a fixed amount to be paid by the transferee to the transferor annually as "purappad", that is, the net produce or net rent payable to the janmi after deducting interest on advances made by the tenant and the Government tax. In 1949 the appellant and the respondents divided the property among themselves by metes and bounds and in 1967 the appellant purchased Janmam rights in the entire land from the transferors for a small ium including the otti debt with a view to become the owner and therefore a mortgagor and thus get compensation with respect to the 3 I "4th share also. When the land was acquired by the Government the appellant claimed the entire compensation, while the respondents contended that the otti deed was re :lly a lease deed and that as tenants in possession of the land they would be entitled to the entire compensation under the Kerala Land Reforms Act, 1963. The trial court held that the document was a mortgage while the High Court held it to be a lease. Dismissing the appeal to this Court, HELD : (1) (a) When there are some mixed elements in an instrument disclosing features of mortgage as well as of lease. the Court will have to find out the predominant intention of the parties executing the document viewed from tho essential aspect of the reality of the transaction. [701 Al (b) In construing a document it is always necessary to find the intention of the party executing it. The intention has to be gathered from the recitals and the terms in the entire document and from the surrounding circumstance~ 1.nd how the parties or even their representatives-in-interest treated the deed in question. The nomenclature given to a document by the scribe or even by the parties is not always conclusive. The word 'otti', used in the document, is not, therefore, of much consequence. (698 Fl rn the instant case the document taken as a whole lacks the most. essential ingredient of a mortgage, namely, that the transfer of the property has to be made as a security for the debt. The document stated that fixed rent was to be paid annually in addition to the Government revenue which the transferee was required to pay. This feature of payment of rent tilts the balance in favour of construing the document as a lease, coupled with the fact that the essence of a mortgage being the transfer of immovable property as security for the debt is absent. There is no right to sell the property in case the debt is not rep"aid. There is nothing to show that the enjoyment of the usufrnct was intended to wipe out the debt in the long period of occupation. While there was arrange- ment to pay a fixed annual "purappad" to the transferor, such a sum was not ' I \. I , ( - PUZHAKKAL KUTTAPPU \I. c. BHARGAVI (Goswami, J.) 697 intended to be utilised towards reduction of the principal debt. There is suffi- cient force in the contention of the respondents that the transfer?rs themselves treated this document as a lease, for else, it could not be explamed "".hY tl~ey would have parted with their Janmam right of. the entire property_ mclus1ve of the otti debt if they themselves regarded this document as an mstrument af mortgage. A (2) The High Court .was, however, wrong in holding that where the docu- ment was of a composite character disclosing features of both mortgage and B lease it must be taken as a lease. [700 HJ Later Full Bench decision in Velayudhan Vil'ekanandan v. Ayyappa11 Sadasil'an, I.LR. [1975] 1 Kerala 166, approved. · CrvrL APPELLATE JURISDICTION : Civil Appeal No. 1815 of 1975.
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