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2017 Supreme(SC) 1024
SUPREME COURT OF INDIA
Ranjan Gogoi, Navin Sinha, JJ.
SURAJ NARAIN KAPOOR AND OTHERS – APPELLANT(s)
VERSUS
PRADEEP KUMAR AND OTHERS – RESPONDENT(s)
CIVIL APPEAL No.1300 OF 2009
Decided On : 24-10-2017
IMPORTANT POINT
Mere incorporation of a right to redemption would not make the document a mortgage.
Headnote:Transfer of Property Act, 1882 – Section 58(C) – Mortgage – Redemption – The document – Whether mortgage by conditional sale, or a sale with an option to repurchase – Suit for redemption decreed by trial court a well as first appellate court – High Court reversing the same in second appeal – Document styled as sale deed – Vendors original owners – Recitals not referring to any loan taken or mortgage created as security to loan – Suit for redemption filed after the stipulated 5 years – Mere incorporation of a right to redemption would not make the document a mortgage – High Court rightly the document to be a sale deed. (Para 7, 8, 10)
1993 Supp. (1) SCC 295 – Relied upon
1963 Supp (2) SCR 82; 1955 SCR 174 – Referred
Facts of the case:
The plaintiff’s suit for redemption of mortgage was decreed by the trial court and was affirmed in first appeal.
However, the High Court, in second appeal, reversed the same.
Finding of the Court:
There is no infirmity in the impugned judgment.
Result: Appeal dismissed.
JUDGMENT
NAVIN SINHA, J.
The plaintiff’s suit for redemption of mortgage, decreed by the trial court and affirmed in first appeal, having been reversed by the High Court, the plaintiff is in appeal. The parties shall be referred to by their respective position in the suit, for convenience.
2. Learned counsel for the appellants submits that the High Court grievously erred in reversing the concurrent findings of two courts that Exhibit-A1 was a mortgage by conditional sale, and not a sale deed with an option to repurchase. The intention of the parties to create a mortgage by conditional sale only is apparent from the right to redemption being incorporated in the same document, fulfilling the statutory requirement under Section 58(C) of the Transfer of Property Act. Reservation of the right to redemption for five years only, was not relevant as the right would be co-extensive with the statutory period of 30 years.
3. Conversely the submission on behalf of the respondents is that the High Court on an examination of Exhibit-A1 has rightly held that it was a sale with a condition for repurchase, and not mortgage by conditional sale. The recitals in the document were self-explanatory and did not evidence any mortgage or loan, much less to discharge any debt, or the relationship of debtor and creditor. Merely because there may have been an option for repurchase within 5 years incorporated in the same document, would not ipso fact confer on it the nature of a mortgage by conditional sale. The suit for redemption was also not filed within five years.
4. We have considered the submissions. The question whether a document is a mortgage by conditional sale, or a sale with an option to repurchase, is a vexed question to be determined in the facts of each case. Reference may appropriately be made to Bhoju Mandal vs. Debnath Bhagat, 1963 Supp (2) SCR 82, observing as follows:-
4. There is a clear legal distinction between the two concepts, a mortgage by conditional sale and a sale with a condition of re-purchase. The former is a mortgage, the relationship of debtor and creditor subsists and the right to redeem remains with the debtor. The latter is an out and out sale whereby the owner transfers all his rights in the property to the purchaser reserving a personal right of re-purchase. The question to which category a document belongs presents a real difficulty which can only be solved by ascertaining the intention of the parties on a consideration of the contents of a document and other relevant circumstances. Decided cases have laid down many tests to ascertain the intentions of the parties but they are only illustrative and not exhaustive.
5. The true nature of the document therefore has to be determined in the facts of each case, dependent on the nature of the recitals in the document, intention of the parties, coupled with other attendant surrounding circumstances.
There can be no hard and fast rule for determining the nature of the document, devoid of these circumstances. Precedents, in abundance, will not suffice alone, as observed in Pandit Chunchun Jha vs. Sheikh Ebadat Ali and another, 1955 SCR 174, as follows:-
“There are numerous decisions on the point and much industry has been expended in some of the High Courts in collating and analyzing them. We think that it is a fruitless task because two documents are seldom expressed in identical terms and when it is necessary to consider the attendant circumstances the imponderable variables which that brings in its train make it impossible to compare one case with another. Each case must be decided on its own facts.”
6. In the facts of the instant case, considering that the suit had been decreed by two courts, it was considered prudent to re-examine the deed document in its original vernacular version, rather than to rely upon the meaning assigned to the recitals according to the unofficial translators understanding.
7. A bare reading of the original document reveals that it is styled as a
