The mortgage deed constituted a valid mortgage by conditional sale, and the plaintiff's failure to repay within the stipulated period validated the defendant's ownership claim.

JUDGMENT :

VIKRAM NATH, J.

1. Leave granted.

2. These appeals challenge the judgment and order dated 06.09.2018 passed by the High Court of Chhattisgarh at Bilaspur in First Appeal No. 28 of 2004, as well as the subsequent order dated 30.01.2019 in Review Petition No. 222 of 2018. The High Court dismissed both the appeal and the review petition filed by the appellant (defendant), thereby affirming the decree passed by the Additional District Judge, Manendragarh, District Korea, in Civil Suit No. 26-A/2001.

3. For clarity, the parties will be referred to by their original status in the suit. The appellant will be referred to as the defendant, and the respondent as the plaintiff.

4. The factual matrix leading to the present appeal is as follows:

4.1 The dispute centers around a piece of agricultural land measuring 2 acres, bearing Khasra No. 202/7, situated in Patwari Halka No. 10, Manendragarh, near Hansiya River, Ward No. 1 (hereinafter referred to as “the suit land”). The plaintiff is the undisputed owner of this land.

4.2 In 1990, the plaintiff, in need of funds, approached the defendant and mortgaged the suit land for a sum of Rs. 75,000. A mortgage deed was executed and registered on 17.10.1990.

4.3 The plaintiff contends that it was orally agreed that she could redeem the mortgage within three years by repaying a total sum of Rs. 1,20,000, which included the principal amount, interest, and expenses. She remained in possession of the suit land throughout this period.

4.4 In 1993, the plaintiff attempted to redeem the mortgage by offering Rs. 1,20,000 to the defendant. However, the defendant refused to accept the payment, asserting that, according to the terms of the mortgage deed, the mortgage had transformed into an absolute sale due to the plaintiff's failure to repay the amount within the stipulated time.

4.5 Aggrieved by the defendant's refusal, the plaintiff filed Civil Suit No. 26-A/2001 before the Court of Additional District Judge, Manendragarh, seeking redemption of the mortgage and a declaration that the defendant's claim of ownership was invalid.

4.6 The defendant contested the suit, asserting that the mortgage deed contained a condition converting it into a sale deed upon default and that the plaintiff had failed to repay the amount within three years. The defendant maintained that she had become the rightful owner of the suit land.

4.7 After considering the evidence and hearing both parties, the Trial Court decreed the suit in favor of the plaintiff on 14.11.2003. The court held that the condition converting the mortgage into a sale was a clog on the equity of redemption and allowed the plaintiff to redeem the mortgage by paying Rs. 1,20,000 to the defendant. This amount has been deposited by the plaintiff with the Trial Court and is lying in deposit as such.

4.8 Aggrieved by the Trial Court's judgment, the defendant filed First Appeal No. 28 of 2004 before the High Court of Chhattisgarh at Bilaspur. The High Court, by its judgment dated 06.09.2018, dismissed the appeal and affirmed the Trial Court's decision.

4.9 The defendant subsequently filed Review Petition No. 222 of 2018 before the High Court, challenging the dismissal of her appeal. The High Court dismissed the review petition on 30.01.2019.

5. Being aggrieved with the judgments of the High Court in both the appeal and the review petition, the defendant has preferred the present appeal before this Court.

Arguments for the Defendant (Appellant)

6. Learned counsel for the defendant contends that the courts below erred in holding that the mortgage deed dated 17.10.1990 was a simple mortgage under Section 58(b) of the Transfer of Property Act, 1882.¹ [In short ‘the Act’] It is submitted that the mortgage deed was, in fact, a mortgage by conditional sale as per Section 58(c) of the Act, containing a clear stipulation that if the plaintiff failed to repay the mortgage amount along with interest within three years, the mortgage would automatically convert into an absolute sa