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2001 Supreme(Guj) 45
Gujarat High Court
Judgename :D.M.Dharmadhikari, J.M.Panchal, Y.B.BHATT
SANGAR GAGU DHULA - Appellant
Versus
SHAH LAXMIBEN TEJSHI - Respondent
C.A. 131 of 1980
Decided On : 01/20/2001
Headnote:Civil Procedure Code, 1908 - Sec. 100 - Dismissal of appellant plaintiffs suit for redemption of mortgage property as time barred - Condition of non-redemption for a period of 99 years and that the mortgagee can put up any type of construction in suit property are clog on equity of redemption - In such cases as held by this Court in case Rajgor Danji Mulji through his heirs & Lrs. vs. Somabhai, 1993 (2) GLR 1243 unless clog on equity of redemption is removed right to redeem the property would not arise - Starting point of limitation in such cases would be the date on which the clog on equity of redemption is lifted - Taking this view in Rajgor Danji Mulji (Supra) the Court had dissented from the view taken by this Court in Soni Motiben vs. Hiralal Lakhansinh, 1981 GLR 473 and Madras High Court in case R. Mudaliyar vs. S. Aiyar, AIR 1977 Mad. 297 that clog on equity of redemption is a condition void ab initio & therefore, starting point of limitation would be the date of execution of the mortgage deed - This legal point needs determination for decision as to when limitation starts in such cases - Since there had been divergent views of High Courts, Court held that it would be in the fitness of things if this matter is heard & decided by a larger Bench - Court framed the questions for decision & directed the office to put up papers before Honble Chief Justice for appropriate orders for referring this matter to a larger Bench.
Since in the case of Soni Motiben this Court observed in no unmistakable terms that when a condition in a mortgage deed is found to be a clog on the equity of redemption, it is a condition void ab initio and such a view is also taken by the Madras and Punjab & Haryana High Courts and when another learned Single Judge of this Court (Honble Mr. Justice A.N. Divecha) has taken a contrary view that when such a condition is found to be a clog on the equity of redemption, it is not void ab initio but merely voidable at the instance of suffering party, and having regard to a number of cases in which such a question has been arising or is likely to arise in view of the prevalence of such transactions in certain areas of the State, it would be in the fitness of things if this matter is heard and decided by a larger Bench for deciding the following questions : -
(1)
Whether a condition in a mortgage deed which is found by the Court to be a clog on the equity of redemption is void ab initio or merely voidable at the instance of the suffering party i.e. mortgagor.
(2)
When a mortgage deed stipulates a condition that the mortgage is irredeemable for a period of 99 years or any such long period, whether the starting point of the period of limitation prescribed by Art. 61(a) of the Limitation Act, 1963 for filing a suit for redemption would be the date of execution of the mortgage deed or the date of declaration by the Court that such a condition was a clog on the equity of redemption.
(3)
Whether a suit for a declaration that any such condition is void or voidable (with or without a prayer for redemption of mortgage) filed after expiry of the period of 30 years from the date of execution of the mortgage deed would be time barred under Art. 61(1) of the Limitation Act, 1963.
[Para 14]
( 1 ). THIS appeal has been placed before this Bench for consideration of specific questions framed by the learned single Judge who was hearing this appeal, on the facts and circumstances as under.
( 2 ). The original plaintiff as mortgagor had mortgaged his property, being a residential house with appurtenant land, with the defendant-mortgagee. The consideration for the same was taken by the mortgagor in the sum of Rs. 11000/ -. The mortgage deed specifically contemplated that this consideration will be repayable by the mortgagor to the mortgagee on the expiry of 99 years from the date of the transaction (the deed of mortgage), and on the consideration being repaid, the mortgagor shall be entitled to redemption of the property.
( 3 ). The mortgage deed was executed on 15th December, 1914. However, before the expiry of the stipulated period of 99 years, the heirs of the mortgagor sought to redeem the property by filing a suit on 5th February, 1974. The redemption was sought before the expiry of the stipulated period on the specific averment and contention that the period of 99 years before which redemption could not be enforced was an oppressive term and would in law amount to "a clog on the equity of redemption".
( 4 ). I may only note in passing that the specific prayer made in the suit plaint only seeks a decree for redemption of the property in question. However, the plaint also contains a specific averment that the plaintiff-mortgagor has a right "to seek avoidance" of this oppressive term at any time, and therefore, on this clog being lifted, the plaintiff has a right to obtain a decree of redemption. However, the frame of the suit and the nature of the pleadings as referred to above would make no difference inasmuch as the parties were ad idem on the nature of the controversy. A specific issue had been raised by the trial court as also by the lower appellate Court, and both the parties to the suit had consciously led evidence on the nature of the controversy. In substance, therefore, the plaintiff sought avoidance of the oppressive term which according to the plaintiff amounted to "a clog on the equity of redemption" and consequently sought a decree of redemption of the mortgage.
( 5 ) IT also requires to be noted that under the terms of the mortgage, the mortgagee entered into possession of the property, coupled with the right to reconstruct the same or to make further construction.
( 6 ). The trial Court, after considering the evidentiary material on record, found that the relevant term in the mortgage deed postponing the right of redemption to the expiry of 99 years from the date of the mortgage is oppressive qua the mortgagor and amounts to clog on the equity of redemption, and therefore, the clog requires to be lifted. The trial Court, however, found that the suit was barred by limitation.
( 7 ). In the appeal filed by the plaintiff-mortgagor, the lower appellate Court upheld the findings of fact on the appreciation of the evidentiary material on record, also found that the oppressive clause amounted to a clog on the equity of redemption which requires to be lifted, and also confirmed the finding of the trial Court that the suit was filed beyond limitation. The appeal, was therefore, dismissed. The lower appellate Court came to this conclusion on the basis that the limitation for such a suit under Art. 61 (a) of the Limitation act would commence to run from the date of the document, since the oppressive term is void. The lower appellate Court therefore found that the suit was filed beyond 30 years from the date of the document, and was therefore, barred by limitation.
( 8 ). The plaintiff-mortgagor thereupon filed a Second Appeal under Sec. 100, c. P. C. , in the High Court. During the course of hearing of the Second appeal before the learned single Judge of this Court, a question arose as to whether the oppressive term would be "voidable" or whether it would be "void ab initio", even if the finding
