-Report by Jayseeka Virdi

The Supreme Court on Friday set aside the judgment and decree passed by the First Appellate Court and that of the High Court and passed a decree in favor of the plaintiffs. A bench consisting of Justice Hemant Gupta, A.S. Bopanna said that the suit for redemption of the mortgaged property filed by the appellants must be allowed.

PLAINTIFF’S CONTENTION

The plaintiff relied on various cases to prove its stand, they contended that in Pandit Chunchun Jha v. Sheikh Ebadat Ali & Anr., the suit by the plaintiff for redemption was dismissed by the High Court but when an appeal was filed in the Supreme Court, that appeal was approved. Further, that contended that in the case of Shri Bhaskar Waman Joshi v. Shri Narayan Rambilas Agarwal, the Supreme Court upheld the right of redemption. Counsel for the plaintiff relied on the evidence of the conduct of transferors/defendants which indicated the character of the transaction as a sale. (but this was further dismissed by the Court). A complete reading of the document would show that a sum of Rs.3,000/- was taken as a loan from the defendant for household expenses. The same was to be returned and the defendant was bound to retransfer the land. The condition that if the plaintiff is not able to pay the loan amount within one year, the document will be taken as a permanent sale deed is a contentious clause between the parties.

KEY HIGHLIGHTS

• SC heard the CIVIL APPEAL NO. 10197 OF 2010 filed by the plaintiff which challenges the judgment passed by the HC which affirmed the order passed by the First Appellate Court.
• Both the Courts ruled in favor of the defendants and dismissed the suit for redemption filed by the plaintiffs of the mortgaged property.
• The petitioner wanted his land back from the defendant by giving him the amount he took from him as per the document, and the defendant denied giving him back his. The plaintiff/appellant through this appeal prays in the SC for the redemption of his lands. The SC ruled in favor of the plaintiff and allowed the appeal.

DEFENDANT’S CONTENTION

The learned counsel relied on the judgment of Vanchalabai Raghunath Ithape (Dead) by LR v. Shankarrao Baburao Bhilare (Dead) by LRs & Ors. 10. In this case, the suit for redemption filed by them was maintained. But he said that the cases reported in Umabai and Tulsi were not brought to the notice of this Court. The learned counsel contended that, since such judgments were not being considered, the judgment of the Supreme Court in the Vanchalabai case could not form a valid and binding precedent on the Court. The learned counsel for the defendants further referred to Dharmaji Shankar Shinde & Ors. v. Rajaram Shripad Joshi (Dead) through LRs & Ors, the suit of redemption filed by the plaintiffs was dismissed by this Court. Another judgment relied on by him was Sopan (Dead) through his LR v. Syed Nabi. Learned counsel for the defendants also referred to the fact that the suit by plaintiffs was filed after twenty years of the document being executed and, during the time, the defendants had improved the land. Therefore, because of this, the plaintiff was not allowed to demand redemption.

SUPREME COURT ALLOWED THE APPEAL

The Supreme Court allowed the appeal by the plaintiffs and said that the defendant’s contention that the plaintiff had filed suit for redemption after 20 years of execution of the document could not be accepted because the limitation period for filing a suit for redemption was 30 years. Therefore, the Court said that they found the order of the First Appellate Court which accepted the appeal of the defendants and dismissed the suit for redemption was not legally sustainable, and the same goes for the order of the High Court.

What are the key provisions of the Transfer of Property Act, 1882?

• Section 63 of the Act states that accession by the mortgagee, during the mortgage being continued, the mortgagor shall be allowed to such accession on redemption, but if a contract has been signed to the contrary then he shall not be entitled to accession even in redemption.
• Section 63(a) of the Act, liability of mortgagor to pay for improvement arises only if the mortgagee incurred the costs in an unavoidable situation, for example, to prevent it from destroying or necessity arose because of the security being inadequate or to comply with an order bypassed a competent authority.
• Section 58(c) of the Act, as amended in the year 1929 and a proviso was added to the section, which said that no transaction will be considered to be a mortgage, unless and until such condition is already present in the particular document which affects the sale.

Discuss the provisions related to Transfer of Property Act

• Section 5
• Section 7
• Section 54
• Section 58(c)