Case Note & Summary
The respondent (original plaintiff) filed a suit for possession and reconveyance of an agricultural land bearing Survey No.275, admeasuring 22 Ars, claiming that the property was mortgaged to the appellant by way of a conditional sale deed dated 5 October 1970 for Rs.1500, with a repayment period of 10 years. The respondent alleged that he repaid the mortgage money in 1973, but the appellant retained possession. The appellant contended that the transaction was an outright sale, and alternatively, claimed adverse possession from 29 March 1973. The Trial Court decreed the suit, ordering redemption and possession. The District Court dismissed the appeal. In this second appeal, the High Court considered whether the deed was a mortgage or sale, and whether the adverse possession claim was valid. The court held that the deed was a mortgage by conditional sale under Section 58(c) of the Transfer of Property Act, 1882, as the relationship of debtor and creditor existed and the right to redeem was reserved. The appellant's claim of adverse possession failed because his possession was permissive as a mortgagee, and he acknowledged the respondent's title by accepting the mortgage money. The court dismissed the appeal, affirming the lower courts' decrees.
Headnote
A) Transfer of Property Act - Mortgage by Conditional Sale - Section 58(c) - Construction of Deed - The court considered whether a deed titled as a conditional sale with a reconveyance clause constituted a mortgage or an outright sale. The court held that the deed was a mortgage by conditional sale, as the relationship of debtor and creditor was established and the right to redeem was reserved. (Paras 2-5) B) Limitation Act - Adverse Possession - Article 65 - Burden of Proof - The appellant claimed adverse possession from 29 March 1973. The court held that the appellant's possession was permissive as a mortgagee, and the claim of adverse possession failed because the appellant acknowledged the title of the respondent by accepting the mortgage money. (Paras 3, 6) C) Transfer of Property Act - Right of Redemption - Section 60 - Mortgagor's Right - The court affirmed that the mortgagor's right to redeem the property subsists until the mortgage is extinguished by a decree of foreclosure or sale. The respondent's suit for redemption was within time as the mortgage was subsisting. (Paras 4-5)
Issue of Consideration
Whether the suit transaction was a mortgage by conditional sale or an outright sale, and whether the appellant's claim of adverse possession was sustainable.
Final Decision
Second Appeal dismissed. Judgment and decree of the Trial Court, as confirmed by the District Court, are upheld. No order as to costs.
Law Points
- Mortgage by conditional sale
- Right of redemption
- Adverse possession
- Limitation
- Section 58(c) Transfer of Property Act
- 1882
- Section 60 Transfer of Property Act
- Article 61(a) Limitation Act
- 1963
