RAJA KAMAKSHYANARAYAN SINGH BAHADUR vs CHOHAN RAM AND ANOTHER

The Supreme Court held that prior to the enactment of Section 65-A of the Transfer of Property Act, a mortgagor in possession could only lease mortgaged property in accordance with the usual course of management. The Court ruled that a permanent lease granted by the mortgagor was not binding on the mortgagee or auction purchaser, as it was not executed in the ordinary course of management, despite not impairing the security of the mortgage. The judgment distinguished between valid leases and those that alter the character of the property or its use.