Important PointA deed must be construed, having regard to the language used therein, therefore, with a view to ascertain the nature of a transaction the document has to be read as a whole. A sentence used or a term used may not be determinative of the real nature of transaction.

Headnote:(i) Transfer of Property Act, 1882—Sections 58(C) and 83—Indian Evidence Act, 1872—Sections 91 and 92 —Mortgage—Sale with a condition of re-transfer, not a mortgage—It is not a partial transfer—Respondents filed a suit against appellant for a declaration that the transaction dated 24-6-1977, although ostensibly expressed in the shape of a deed of sale, was in fact a transaction of usufructuary mortgage—Deed in question was titled as a ‘deed of sale’—Respondents were described as ‘vendor’ and appellant as a ‘vendee’—Nature of deed was mentioned as ‘Sale Deed (Kewala)’—Amount paid by appellant to respondents was treated to be the consideration money—In the recitals made therein the purpose of executing the deed of sale was stated to be as for repaying the debts taken by respondents from several money lenders—On the same date, an agreement for sale was executed—It was stated therein that the said deed of sale was executed on the Baibulbafa condition—No stipulation has been made that appellant cannot transfer the property—Appellant was put in possession of land—His name was also mutated—Trial Court as also the first Appellate Court arrived at a concurrent finding that the said transaction did not constitute a mortgage—‘Baibulwafa’ was held to be a deed of conditional sale with a contract of repurchase—Impugned judgment of High Court interfering with concurrent finding held not sustainable—Civil Procedure Code, 1908—Section 100—Bihar Money Lenders Act, 1974—Section 12.
       Held : It is not in dispute that the deed in question was titled as a ‘deed of sale’. The respondents were described as ‘vendor’ and the appellant as a ‘vendee’. The nature of the deed was mentioned as ‘Sale Deed (Kewala)’. The amount paid by the appellant to the respondents was treated to be the consideration money. In the recitals made therein the purpose of executing the deed of sale was stated to be as for repaying the debts taken by the respondents from several money lenders and it was recited that they did not have any source of income to repay the debts and no means of liquidating the debts except to sell out the said land. (Para 13)
       On the same date, as noticed hereinbefore, an agreement for sale (Ekrarnama) was executed where again the parties were described as ‘Vendor’ and ‘Vendee’. In the said agreement for sale, the parties referred to the deed of sale executed on the said date by the respondents. However, it was stated therein that the said deed of sale was executed on the Baibulbafa condition. It was also stated that the ‘vendees’ agreed that the ‘vendor’ or his successors or heirs whenever would pay the consideration amount of Rs. 3,000/- within 23 months from that date, i.e., upto the month of June, 1978, then he would execute the deed of sale pertaining to the said property. (Para 14)
       The learned Trial Court as also the learned First Appellate Court arrived at a concurrent finding that the said transaction did not constitute a mortgage but thereby the respondents executed a deed of sale in favour of the appellant and the appellant in turn executed an agreement for reconveyance in their favour. ‘Baibulwafa’ was held to be a deed of conditional sale with a contract of repurchase and not a mortgage with conditional sale. On the aforesaid findings it was categorically held that a suit for declaration that the said transactions in effect and substance constitute a mortgage, was not maintainable. (Para 15)
       A deed as is well known must be construed, having regard to the language used therein. We have noticed hereinbefore that by reason of the said deed of sale, the right, title and interest of the respondents herein was conveyed absolutely in favour of the appellant. The sale deed does not recite any other transaction of advance of any sum by the appellant to the respondents was entered into by and between the parties. In fact, the recitals made in the sale deed categorically show that the respondents expressed their intention to convey the property to the appellant herein as they had incurred debts by taking loans from various other creditors. (Para 16)
       A bare perusal of the said provision clearly shows that a mortgage by conditional sale must be evidenced by one document whereas a sale with a condition of re-transfer may be evidenced by more than one document. A sale with a condition of retransfer, is not mortgage. It is not a partial transfer. By reason of such a transfer all rights have been transferred reserving only a personal right to the purchaser, and such a personal right would be lost, unless the same is exercised within the stipulated time. (Para 27)
       (ii) Transfer of Property Act, 1882 —Section 83—Mortgage—Power to deposit in Court money due on mortgage—Mortgagee is free to refuse to accept the deposit—Remedy of mortgagor to institute a suit for redemption relying on mortgage money deposited—Function of a Court in terms of Section 83 of the Act is procedural in nature. (Paras 36 & 37)
       (iii) Words and Phrases—Word ‘Bai-bil-wafa’ or ‘Bye-bil-wuffa/wafa’—Arabic term—It mean a mortgage or a conditional sale—However, the said term is not synonymous to ‘Bai-ul-wafa’. (Para 17)

JUDGMENT

S.B. Sinha, J.—Leave granted.

2. This appeal is directed against the Judgment and Order dated 11th September, 1988 passed by a learned Single Judge of the Jharkhand High Court, Ranchi in Appeal from Appellate Decree No. 176 of 1988 whereby and whereunder a second appeal preferred by the respondents herein from a Judgment and Decree dated 18.7.1988 passed by the 6th Additional District Judge, Palamau at Daltonganj in Title Appeal No. 26 of 1987 setting aside the Judgment and Decree dated 27.6.1987 passed by Munsif, Daltonganj in Title Suit No. 11 of 1986, was allowed.

3. The respondents herein filed a suit against the appellant, inter alia, for a declaration that the transaction dated 24.6.1977, although ostensibly expressed in the shape of a deed of sale, was in fact a transaction of usufructuary mortgage and for a further declaration that the said transaction stands redeemed under Section 12 of the Bihar Money Lenders Act, 1974. The respondents herein further sought for a decree directing the appellant to deliver vacant possession of the suit land to them, failing which they might be put back in possession thereof through the process of Court. The respondents averred that they were occupancy raiyats of the suit land. The appellant herein allegedly gave an advance of Rs. 3,000/- on their executing a deed of usufructuary mortgage in respect of the suit land. However, allegedly the appellant asked them to execute a deed of sale on the ground that he did not possess any money lending licence, whereupon, indisputably such a deed was executed on 24.6.1977. The appellant in turn executed a registered deed of agreement in his favour whereby and whereunder the respondent agreed to execute a deed of reconveyance on his receipt of the said sum of Rs. 3,000/-.

4. The appellant herein in his written statement, on the other hand, contended that in fact a deed of sale was executed on 24.6.1977 by the respondents in his favour. It is, however, accepted that the appellant executed a deed of an agreement for sale on the same day. It is furthermore not in dispute that the respondents herein filed an application in the Court of Munsif, Daltonganj being Miscellaneous Case No. 14 of 1978 purporting to be under Section 83 of the Transfer of Property Act seeking its permission to deposit an amount of Rs. 3,000/- By an Order dated 22.3.1979, despite an objection taken in this behalf by the appellant herein that the transaction in question was not a mortgage, the respondents were permitted to deposit the said amount.

5. It is also not in dispute that the property in question was mutated in the name of the appellant in the Revenue Records of Rights.

6. The Trial Court, in view of the pleadings of the parties, framed the following issues:

"(i) Is the suit, as framed maintainable?

(ii) Have the plaintiffs got cause of action for the suit?

(iii) Is the sale deed dated 24.6.1977 real transaction of usufructuary mortgage deed in view of the agreement of the same day executed by the defendant and, if so, are the plaintiffs entitled to a decree as prayed for?

(iv) To what relief or reliefs, if any, the plaintiffs are entitled?"

7. The said suit was dismissed holding that the deed of sale dated 24.6.1977 coupled with the said agreement of reconveyance of the same date did not constitute a mortgage. It was further held that the remedy available to the respondents was only to file a suit for specific performance of the contract and as such a relief had not been availed of by them within a period of three years, no relief could be granted in their favour. The appeal preferred by the respondents herein thereagainst was also dismissed.

8. The respondents thereafter filed a second appeal before the High Court which was allowed by the impugned judgment.

9. The purported substantial question of law framed by the High Court is as under:

"Whether in view of the admission made by respondent no. 2 in Ext. 2 to the effect that the parties understood the document to be a deed

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2006 Supreme(SC) 168

Important PointA deed must be construed, having regard to the language used therein, therefore, with a view to ascertain the nature of a transaction the document has to be read as a whole. A sentence used or a term used may not be determinative of the real nature of transaction.

Cases Referred (12)