Transfer of Property Cia 3

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CASE ANALYSIS

NARAYAN DEORAO JAVLE (DECEASED) VS KRISHNA


(2021)

SUBMITTED BY: KSHEMA B REDDY


REGISTRATION NUMBER: 2150454
SUMBITTED TO: DR.VALARMATHI R
DEPARTMENT: SCHOOL OF LAW
SUBJECT: TRANSFER OF PROPERTY ACT
CASE ANALYSIS ON NARAYAN DEORAO VS KRISHNA AND
ORS (LL 2021 SC 389)

COURT - The Supreme Court Of India

BRIEF - The appellant was a buyer of a mortgaged property whose


redemption was foreclosed after the sale deed was executed because the
mortgagors failed to pay the mortgage amount to the mortgagee. The
appellant claimed that he is entitled to redeem the property that is
subject to the mortgage. Additionally, he claimed that he should have
been included as a required party in the lawsuit that produced the
aforementioned impugned order.

DATE OF JUDGEMENNT- 17th August 2021


JUDGES- Justice Hemant Gupta and Justice A. S. Bopanna

PARTIES- Appellants: Narayan Deorao Javle (deceased) through LRS.


Respondents: Krishna & Ors.

SUBJECT-The court's decision took into account a number of factors


related to the buyer of a mortgaged property's right of redemption.

The case is further analyzed in the form of FILAC Method which gives
us a better understanding with the facts, issues, laws, analysis and the
conclusion of the case in hand.
FACTS OF THE CASE

 In this case, the plaintiff, Narayan deaorao javle, had executed a


will in 1959 bequeathing his entire property to his adopted son, and
his descendants. However, in 1975, he executed a subsequent will,
revoking the earlier will, and bequeathed his property to his wife,
Krishna, and their children .Narayan deaorao javle passed away in
1976, and his wife and children claimed the property under the
subsequent will. They challenged the validity of the subsequent
will on the grounds of fraud, coercion, and undue influence.
 On April 30, 1954, a property was mortgaged to cover a loan of
Rs. 700.
 After that, on May 18, 1964, a portion of the mortgaged property
was sold to the appellant for a sum of Rs. 1000.
 The appellant was not made a party to the mortgagee's 1965
lawsuit for the recovery of the money that had been mortgaged.
 The sum was to be returned by the mortgagors no later than March
27, 1967, according to a preliminary decree that was issued.
 The preliminary decree was changed into a final decision on June
4, 1969, foreclosing on the mortgagor's right to redeem the
mortgaged property since the respondents failed to pay the sum.
Hence, the mortgagee obtained ownership of the property in 1980.
 Aggrieved by the decision, the appellant sued the mortgagee and
the original borrowers in civil court on January 23, 1984, asking
for the property to be redeemed.
 The lawsuit was dismissed by the Trial Court, and the First
Appellate Court heard an appeal in the case.
 The First Appellate Court overturned the foreclosure judgment,
ruling that the appellant should have been included in the
mortgagee's original lawsuit under Sections 59A and 91 of the
Transfer of Property Act, as failing to do so would render the
judgment null and void.
 The Bench ruled that the Appellant's claim to redeem the
mortgaged property was invalid when the First Appellate Court's
order was presented to the High Court.
 In doing so, it overturned the First Appellate Court's ruling and
reinstated the Trial Court's judgment.
 The appellant filed an appeal with the Supreme Court, arguing that
because the mortgagors had already lost the title before the suit
was filed, the appellant was not only a legitimate party but also a
required party to the action.
 The mortgagee could not be included as a party since he was not
informed of the sale deed between the mortgagors and the
appellant, according to the Respondents.
ISSUES RAISED IN THE CASE

a) Whether the Appellant was a necessary party in a suit for


foreclosure filed by the mortgagee after the purchase?
b) Whether the decree obtained in a suit for foreclosure operates as
Res Judicata and the right of redemption stands extinguished by
the decree of the Court?
c) Whether the plaintiff is entitled to redeem the share of the property
purchased by him on the payment of the entire mortgage amount?

LAWS

 Transfer of Property Act, 1882, Section 59A states that unless


otherwise expressly stated, references to mortgagors and
mortgagees in this Chapter will be construed to include references
to people deriving title from them, respectively.
 Transfer of Property Act, 1882, Section 60 A mortgagor has the
option to redeem the mortgaged property under this Section after
paying the mortgage balance. The mortgagor's right of redemption
includes the following:
I) Delivery of the mortgage deed and other pertinent documents
relating to the mortgaged property kept in the mortgagee's
possession to the mortgagor.
II) Delivery of the mortgaged property to the mortgagor if the
mortgagee is in possession of the property.
III) Re-transfer of the mortgaged property to him or to a third
party as he may direct, or to execute and have registered an
acknowledgement.

Transfer of Property Act, 1882, Section 91 This Section outlines the


parties other than the mortgagor themselves who may request the
redemption of mortgaged property. Thus, under Section 60 of the Act,
redemption may be sought by (a) any person who has an interest in or
charge over the property mortgaged; (b) any surety for the payment of
the mortgage amount or any portion thereof; or (c) any creditor of the
mortgagor who has obtained a decree for sale of the mortgaged property
in a suit for the administration of his estate.

JUDGEMENT ANALYSIS

Based on the grounds stated, the Supreme Court's decision in this case
can be divided into three parts:

1) The Bench noted that there is a "constructive notice" of the


transaction because the parties live in the same village and that the
mortgagee's claim that notice was not delivered is without merit.
Additionally, it stated that the Appellant is a proper and necessary
party to the lawsuit and that he is entitled to request the redemption
of the mortgaged property. "The equity of redemption is part of the
title once the plaintiff has purchased property, and as an owner, he
could seek redemption of the suit land. A right that is subordinate
to the right of ownership is the equity of redemption.
2) It was decided that the Trial Court's judgment is invalid in and of
itself because the Appellant was not made a party to the litigation
and thus is not subject to its terms. "The appellant was not
impleaded as a party, though required under Section 91 of the Act
and Order XXXIV Rule 1 of the Code, therefore the findings
recorded by the High Court that the appellant is bound by the order
passed in the suit for foreclosure is not tenable, among other
reasons."
3) The Appellant's entitlement to redeem the mortgaged property,
according to the Court, is still valid. Although though Section 60
indicates that the right of redemption expires with a court order, it
cannot be used in this situation because the Trial Court's order is
not an authorized order. "The decree of foreclosure passed in the
lawsuit brought by the mortgagee will not extinguish the right of
the mortgagor to redeem land in light of the fact that he was not
impleaded as a party in the suit even though he has acquired a
portion of the mortgaged property by virtue of registered sale deed.
4) These remarks led the Supreme Court to accept the appeal, vacate
the High Court's order, and reinstate the First Appellate Court's
ruling.
5) As a result, it gave the Appellant three months to settle the
mortgage balance before seeking to regain the possession that had
been seized from him by the decision of foreclosure.

CONCLUSION

The mortgagor can use his or her right of redemption to reclaim any
rights or interests in his or her property that were momentarily lost as a
result of the mortgage. According to the Transfer of Property Act, the
right is a statutory and legal one in India. This privilege becomes
exercisable as soon as the mortgage payment is past due, but only during
the limitations period set forth therein. The appellant in this instance also
has the right to redeem because he is a mortgagor under Section 59A of
the Act. According to the Supreme Court, such a right is subsidiary to
the ownership right that the Appellant purchased rather than superior to
it.

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