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Judgment
This Second Appeal was referred to a full bench, as it was claimed that there was conflict of opinion between two division bench rulings,
Ayyappan v. Venkiteswara Naicken 1962 Ker LT 733 and Subramania Iyer Pattar and Others Vs. K.R. Anantanarayana Iyer and Another, on
the one hand, and a Division Bench ruling Valiyaparambath Kalliani v. Achambath Kunhalikutty Haji, S. A. No. 41 of 1959 (Ker) and other
decisions by single Judges, like Sankaran Nambudiripad v. Moideen 1965 Ker LJ 16 and Kuttuparambil Kochak-kan v. Ponnampadikkal
Abdunni, S. A. No. 804 of 1961 (Ker) on the other. The former Division Bench rulings held that a provision in a document to bring to sale the
property transferred to realise the money advanced by the transferee was a strong indication that the parties intended a mortgage and not a kanam
(or any other lease). The latter set of rulings held that such right of sale was by no means a conclusive indication that the transaction was a
mortgage. We have held in Krishnan Nair Vs. Perumbalath Kizhakkiniyakath Manakkal Karnavan and Another, , that there is really no conflict
between the aforesaid two sets of decisions and that the alleged conflict stems from the mistaken impression that the former set of rulings laid down
that the test was a conclusive test. We have considered therein in fair detail the principles to be applied in a case where the question is whether a
transaction embodies a lease or is a mortgage pure and simple.
Two items of properties, a garden land (paramba) having an extent of 1 acre 6 cents and a wet land of 35 cents, are being held by the appellant
1st defendant under the respondent plaintiff under Ext. A-1 (kaivasam panaya kychit) of the 28th October 1945 In answer to the plaintiffs'' suit for
redemption and possession, the appellant claimed before the trial court firstly that the transaction was a kanam; secondly, in the alternative, that at
the least the property constituted a kudiyiruppu. He claimed the first both on the language of Ext. A-1 and u/s 22 of the Malabar Tenancy Act
(corresponding to section 12 of Act 1 of 1964), and, on that basis, claimed fixity of tenure. Both the lower courts have held that the transaction
was a mortgage. However, the trial court held that the appellant was entitled to fixity of tenure over plot A in item 1 of Ext. A-1 (a little over one
acre) as a kudiyiruppu, because he was a holder of a kudiyiruppu, which meant a tenant of a kudiyiruppu -- this was before the lull bench decision
in Raghavan Naicken v. Ayvappankutty 1964 Ker LT 65 (FB) pointing out that you must first be a tenant before you can claim fixity u/s 21 of the
Malabar Tenancy Act as the tenant of a kudiyiruppu. Accordingly it allowed redemption of the mortgage subject to the first defendant retaining
possession of plot A as his kudiviruppu
The lower appellate court on appeal by the plaintiffs -- the defendants did not appeal against the first court''s decree -- also agreed with this
conclusion, but modified the decree by confining the kudiyiruppu right to 25 cents and declaring the plaintiffs'' right to redeem and obtain
possession of the rest of the property This Second Appeal by the 1st defendant is against this decision and, not having appealed against the first
court''s decree, he has, in effect, asked only for a restoration of that decree
However, pending second appeal, Act 1 of 1964 came into force; and the appellant, who is still in possession of the entire property, has filed C
M. P. No. 8610 of 1965 u/s 132(31 (a) of the Act to reopen even the decree for possession made by the first court (and confirmed by the lower
appellate court which, as we have seen decreed a larger extent) in respect of plot A and to decide the entire case under the Act, his contention
being that Ext- A-1 embodies a lease and that the courts below were wrong in holding that it was purely a mortgage. This prayer is opposed by
the respondents. u/s 132(3)(a) of Act 1 of 1964, even if a decree is passed and that has become final-still, if eviction in pursuance of the decree
has not taken place, the judgment-debtor may by application claim to have the decree reopened and the matter disposed of under the Act. The
Act does not specify the court to which the application is to be made, but, it is argued that, since the decree for possession of the rest of property
after excluding plot A was not appealed against and is therefore not before us, the application can be made only to the trial court. We are unable to
agree.
Section 13(1) of the Act confers fixity of tenure on a tenant in respect of his holding, notwithstanding anything to the contrary contained in any law,
custom, usage or contract, or, in any decree or order of court. It is therefore clear that if the appellant is a tenant, as we shall presently show he is,
he cannot be evicted from any portion of his holding in spite of there existing a decree for eviction from a portion of the holding against which he
has not appealed, since the fixity of tenure relates to the entire holding. The only question is whether he can make an application u/s 132(3)(a) to
the court before which an appeal from a part of the decree is pending, or whether his right to apply can be exercised only before the trial court. In
a case where the entire decree for eviction is challenged in appeal the appeal has to be disposed of under the Act. In a case where no portion of
the decree for eviction is challenged in appeal (the subject-matter of the appeal being some other incidental matter) it is possible to argue that the
application to reopen the decree may be only to the trial court and not to the appellate court. But, in a case like this, where at least a portion of the
decree for eviction is challenged in appeal, an application u/s 132 (3) (a) will we think lie before the appellate court, since the fixity of tenure u/s 13
relates to the entire holding and the decree for eviction from a part of the holding at least is the subject-matter of the appeal.
Therefore, we are of opinion that the application lies to this court and it has to be allowed and the entire case disposed of under Act 1 of 1964.
The objection to our entertaining the application is, at best, technical. For, the plea of fixity in respect of the portion of the property in respect of
which the decree of the first court has become final is a plea which the appellant can take in an application made to the proper court (whichever it
is) or before the executing court and these courts would be bound to decide the matter in accordance with our finding here with regard to Ext. A-
Even without an application u/s 132 of the Act, our powers under Order XLI Rule 33 are probably wide enough to enable us to give the
appellant the relief he seeks if he is entitled to it; and the circumstance that if we do not give him the relief he would be entitled to get it on
application made under S, 132 of the Act or from the executing court would certainly persuade us to exercise our discretion in his favour
The further argument that since there was no appeal even to the lower appellate court against the finding that Ext. A1 was a mortgage, that
finding has become final, at least in so far as the part of the property of which possession was decreed by the first court is concerned, has no force.
When a decree is reopened the findings on which it is based go, and there is little point in the argument, based on a comparison of the two statutes,
that if, as found by the courts below, Ext. Al is not a lease according to the provisions of the Malabar Tenancy Act it cannot be a lease according
to the provisions of Act 1 of 1964.
The first item (the paramba) was being held under an earlier arrangement of 1933, when Ext. Al replaced it in 1945. The amount advanced
under the earlier arrangement was Rs. 300 and there was no further advance under Ext. Al. The annual income of item 1 fixed under Ext. Al is Rs.
91 out of which a sum of Rs. 18 is deducted for the interest on the sum advanced leaving a balance of Rs. 73 to be paid to as michavarapurappad
For the wet land, 11 paras of paddy valued at Rs. 16-8-0 is fixed as the annual payment. In addition, perquisites like a bunch of bananas worth
Rs. 2-8-0, one chothana of coconut oil worth Rs. 3-6-0 and six bundles of cadjan leaves of 25 each worth Rs. 4-8-0 have also to be given. Thus
the michavaram payable is Rs. 73 for item 1 and 11 paras of paddy or Rs. 16-8-0 for item 2 and perquisites like bananas, coconut oil and cadjan
leaves. There is a recital in the document that the second item was included at the request of the transferees. Another provision is that the expenses
of the surrender deed have to be met by the transferees. The transferees are given a right to claim their money and recover it by sale of the
properties; and they are also given the right to improve the properties and get value for the improvements at the time of surrender. These are the
material provisions of the document.
Even without the aid of Section 22 of the Malabar Tenancy Act (section 12 of Act 1 of 1964) it can be successfully argued that what the parties
intended by the transaction was an arrangement for enjoyment of the properties rather than for securing the amount advanced. Counsel for the
respondents has argued that the second item was included as additional security in 1945. This argument has no force, because even the income of
the first item was Rs. 91 out of which only a sum of Rs. 18 was to be deducted for the interest of the money advanced thus leaving an excess of
Rs. 73. This shows that even the first item was at least three or four times more valuable than was necessary to secure the amount advanced. To
that the second item was also added, for which 11 paras of paddy (Rs. 16-8-0) were also to be paid. Evidently, the arrangement could not have
been to secure the sum of Rs 300 advanced; it could only have been with a view to the enjoyment of the trans- ferees. The payment of perquisites
would also indicate that the relationship was that of landlord and tenant. The provision that the transferees should meet the expenses of the
surrender also points to the same direction. The two indications in the document that can be claimed to be in favour of the respondents are the right
of sale conferred on the transferees to realise the amount advanced by them, and the name of the document, kaivasom panayam.
We have clearly indicated in S. A. No. 173 of 1962 = (reported in Krishnan Nair Vs. Perumbalath Kizhakkiniyakath Manakkal Karnavan and
Another, that neither of them is conclusive that the transaction is purely a mortgage and does not embody a lease. As stated by us in that decision,
the real test is whether the transfer was intended by the parties for the enjoyment of the property by the transferee or whether it was intended
solely to secure the amount advanced by him. It is clear from the facts of this case that the real purpose of the transfer could only have been the
enjoyment of the property by the transferees, in other words the transaction embodies a lease and the conclusion of the lower courts that the
transaction was purely a mortgage cannot stand. It follows that the appellant is entitled to fixity in respect of the entire property covered by Ext. A1
and that the plaintiffs are not entitled to recover any portion thereof.
We allow the second appeal and dismiss the suit. Since we have reopened the decree and dismissed the suit, we direct both parties to bear their
respective costs throughout.
The plaintiff respondents have filed a memorandum of cross-objection in respect of the 25 cents of land of which the lower appellate court has
denied them possession. It follows from what we have held that this has to be dismissed and it is accordingly dismissed but without costs.