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2007 Supreme(Bom) 1274

IN THE HIGH COURT OF BOMBAY
V.R. KINGAONKAR, J.
Vasantrao s/o. Manoharrao Neb — Appellants
Versus
Kishanrao s/o. Shankarrao Neb — Respondents
SECOND APPEAL NO. 352 OF 1990
WITH
CIVIL APPLICATION NO. 3824 OF 1990
Decided on : 6TH SEPTEMBER, 2007

Advocates:
Advocate appeared
Mr. R.P. Dhas, Advocate h/f Mr. A.H. Vaishnav, Advocate for the appellants.
Mr. S.P. Deshmukh, Advocate h/f. Mr. P.R. Deshmukh, Sr. Advocate for respondent Nos. 1 to 5. Respondent No.6 abated.

Headnote:Transfer of Property Act, 1882 - Section 58(c) - Limitation Act, 1963, Section 3, Article 61 - Mortgage b y conditional sale - Property mortgaged - For Rs. 7,000/- with condition that if amount not repaid by mortgage or within 5 years transaction will be treated as sale - Suit for redemption - Dismissed by lower Court - Lower appellate Court decreed suit - Second appeal - Document quite clear - Parties intended to treat it as a mortgage - Condition of deemed sale is a clog on redemption - Not tenable - Second appeal liable to be dismissed. - It is well settled that if the condition of reconveyance is enumerated in document itself, then it has to be regarded as mortgage as provided under Section 58(c) of the Transfer of Property Act, 1882. The question is always of intention of the parties. The extraneous evidence can be considered only when the terms of the documents are vague. However, if the terms of the document are clear enough then it is not necessary to consider the other evidence. In the present case, there was no concession granted as such. What is explicit from the terms of the document is that if the mortgage amount is returned within period of five years, then mortgage will be redeemed and if it is not so done, then document itself would be treated as sale. Obviously, understanding between parties to the document was clear. They intended to bring about mortgage. It is not a case where right of ownership was transferred in favour of said Vasantrao Neb or his father. The amount was also referred as "mortgage amount". The condition incorporated in the document is to the effect that in case the mortgage money would not be paid within five years period, the document will be deemed as sale. In other words, the transaction was not of out and out sale, when the document was brought about. No right of ownership had passed in favour of the mortgagee. Then, deceased Shankarrao had not recognized the fact that his interest in the property was relinquished due to such transaction. The document clearly supports the condition which creates clog on redemption of the mortgage. There is no substratum on record to reach conclusion that the parties intended to sell the suit house property by giving concession to deceased Shankarrao to repurchase the same on certain condition.

JUDGMENT :

. This Second Appeal arises out of judgment rendered by learned Second Additional District Judge, Jalna, in appeal bearing Regular Civil Appeal No.114 of 1984. By the impugned judgment, the learned Additional District Judge was pleased to set aside dismissal of suit for redemption of mortgage and granted decree for redemption.

2. The appellants are legal representatives of deceased Vasantrao Neb, who was original defendant No.1. The respondents are legal representatives of deceased Shankarrao Neb. They are original plaintiff and defendant Nos.2 to 6. Deceased Shankarrao Neb was the owner of suit house property. He executed a document dated 03.02.1953, in favour of deceased defendant Vasantrao, whereby the suit-house property was mortgaged for 7000/- Osmaniya Sikke. The mortgage deed is styled as "Rahan Bil Kabja", and is written in Urdu script. It was agreed between the parties that the suit property would be given in possession of Vasantrao Neb. It was agreed that from day of execution of the mortgage deed he would continue to remain in possession till the amount was repaid. It was further agreed that there shall be no rent for the house property, which comprised of a shop, and the amount advanced to Shankarrao Neb will not be charged with any interest. They agreed that the mortgage amount will be repaid within period of five years by Shankarrao Neb and on his failure to pay the said amount within stipulated period, it will be deemed that the suit house property is sold and mortgagee i.e. Vasantrao Neb will be treated as owner thereof.

3. Respondent No.1 filed suit for redemption of mortgage alleging that he was entitled to redeem the mortgage on repayment of the mortgage amount to the mortgagee i.e. original defendant No.1 - Vasant Neb. He asserted that deceased Vasant refused to accept the amount and redeem the mortgage. According to deceased defendant No.1 Vasant, the plaintiff’s father never made any attempt for redemption of mortgage and therefore the suit was barred by limitation. He asserted that the document was conditional sale. The condition regarding repayment within five years was not fulfilled by the plaintiff’s father and hence the ownership rights were transferred as per terms of the document. He asserted that he became owner of the house property in question, after period of stipulated five years and as such the suit for redemption of mortgage is barred by limitation. Hence, he sought dismissal of the suit.

4. The parties went to trial over certain issues struck below Exh.16. The learned Trial Judge held that the defendant No.1 - deceased Vasant Neb became owner of the house property, because the transaction was conditional sale. The Trial Court held that the document itself was to be treated as absolute sale from the date of breach of condition to repay the amount within stipulated period of five years. Hence, the suit was dismissed. The first Appellate Court reversed the dismissal of the suit. The first Appellate Court held that the suit house property was mortgaged and the condition incorporated in the document created a clog on mortgage. The first Appellate Court held that such condition is void in the eye of law. The first Appellate Court, therefore, decreed the suit.

5. The Second Appeal was admitted on ground Nos.1 to 6 and ground No.8 shown in the appeal memo. Same questions may be repeated if these grounds are reproduced. Therefore, in order to avoid repetition and to ensure that the substantial questions raised in the appeal do not overlap, I deem it proper to articulate the substantial questions of law in the following way :

(1) Whether in the facts and circumstances of the present case, document dated 03.02.1953 styled as "Rahan Bil Kabja" (mortgage with possession) is a mortgage or that it is a conditional sale and the appellants become owner due to failure of the plaintiff’s father to repay










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