MANU/SC/0230/2000

Equivalent Citation: AIR2000SC 1935, 2000 (40) ALR 218, JT2000(4)SC 177, 2001-2-LW107, (2000)3MLJ8(SC ), (2000)126(3)PLR495,
2000(2)RC R(C ivil)765, 2000(3)SC ALE10, (2000)4SC C 326, [2000]2SC R878

IN THE SUPREME COURT OF INDIA

C.A. No. 2333 of 2000 (Arising out of S.L.P. (C) No. 18251 of 1999)
Decided On: 31.03.2000
Appellants:Shivdev Singh and Ors.
Vs.
Respondent:Sucha Singh and Ors.
Hon'ble Judges/Coram:
Saiyed Saghir Ahmad and R.P. Sethi, JJ.
Case Note:
Property - redemption - Section 60 of Transfer of Property Act, 1882 -
respondent-plaintiff filed suit for possession by way of redemption against
appellant - suit decreed - appeal - Courts below held that mortgage deed
being for period of 99 years was clog on equity of redemption - appellants
found to be in advantageous position qua mortgagor - they were also found to
be deriving usufructs of mortgaged land for period of over 26 years at time of
filling of suit on payment of meager sum of particular amount only to
mortgagor - findings of facts returned by Courts below do not require any
interference particularly when counsel appearing for appellants has not
contented that such findings were perverse or uncalled for or against
evidence - appeal dismissed.
Case Category:
SIMPLE MONEY AND MORTGAGE MATTERS ETC. - MORTGAGE PRIVATE
JUDGMENT
R.P. Sethi, J.
1. Leave granted.
2. Claiming to be the owner of the disputed property being land measuring 23 kanals 2
marlas situate in Village Sansra, Tehsil Ajnala, Punjab, the respondent-plaintiff filed a
suit for possession by way of redemption against the appellants in the Court of
Additional Senior Sub-Judge, Ajnala. The suit was decreed by the trial court with a
direction for delivery of possession by way of redemption on paying depositing the
mortgage money of Rs. 7,000/- minus the cost of the decree. The appeal filed by the
appellants was dismissed by the First Appellate Court on 25th July, 1998 and second
appeal was dismissed vide the judgment impugned in this appeal.
3. It is contended on behalf of the appellants that the clause prescribing the period of
mortgage did not constitute a clog on the equity of redemption and that the suit filed
before the expiry of the stipulated time was premature in terms of Section 60 of the
Transfer of Property Act. In support of their contentions the appellants have relied upon
the judgment of this Court in Ganga Dhar v. Shankar Lal MANU/SC/0118/1958 :

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[1959]1SCR509 and distinguished the judgment relied upon by the High Court in the
case of Pomal Kanji Govindji and Ors. v. Vrajlal Karsandas Purohit and Ors.
MANU/SC/0372/1988 : AIR1989SC436 .
4. In order to appreciate the rival contentions, it is necessary to take note of the facts
of the case which have given rise to the filing of the present appeal. The disputed
property was owned by one Prakash Singh who had mortgaged the same in favour of
Smt. Basant Kaur for a sum of Rs. 7,000/- vide mortgage deed dated 19.3.1968. The
said Smt. Basant Kaur died whereafter the appellants herein stepped into her shoes qua
the suit property and, according to the plaintiffs became mortgagees in possession of
the said land. The said Shri Prakash Singh, the original owner, sold the land measuring
19 kanals 2 marlas out of the mortgaged property in favour of the respondents Sucha
Singh vide registered sale deed dated 25th March, 1987 for a valid consideration by
which the mortgage money of Rs. 7,000/- was kept with the respondent-plaintiff as
security (Amanat) to be paid to the appellants. It was further pleaded by the plaintiff
that at the time of the original mortgage deed dated 19.3,1968 the said Shri Prakash
Singh was financially tight and allegedly taking undue advantage of his poor financial
condition and helplessness the appellants got incorporated a term in the mortgage
deed, to the effect that the mortgage was for a period of 99 years which constituted a
clog on the equity of redemption and that the appellants had been enjoying the
usufructs of the mortgage for more than 20 years before the date of the filing of the
suit. Despite the fact that the respondent-plaintiff had purchased only 19 kanals 2
marlas out of the mortgaged land, he offered the whole of the mortgage money to the
appellants-defendant realising that partial redemption was not permissible. The
appellants were stated to have refused to deliver possession which necessitated the
filing of the suit.
5. Prakash Singh who was impleaded as defendant No. 3 was proceeded ex-parte. The
appellants, though admitted that the disputed land under mortgage was in their
possession on the basis of a mortgage for a sum of Rs. 7,000/- since the year 1968, yet
contended that the plaintiffs had no right to get the suit land redeemed before the
expiry of mortgage period of 99 years. The suit was stated to be premature and liable to
be dismissed.
6 . On the basis of the pleadings of the parties, the trial court framed the following
issues:
1. Whether the disputed land is liable to be redeemed in favour of the plaintiff
as claimed through this Suit? OPP.
2 . Whether the period of 99 years of mortgage is a clog on the equity of
redemption? OPP.
3. Whether the plaintiff has no locus standi to file this suit? OPD.
4. Relief?
The trial court while deciding Issue Nos. 1 and 2 held:
The clause in the mortgage deed providing for the mortgage of the land for a
period of 99 years constitutes a clog on the equity of redemption and as such is
illegal and void and the same cannot be allowed to stand in the way of the
plaintiff to get the suit land redeemed or acquire its possession. The statutory
right of redemption cannot be fettered by any condition which impedes or

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 prevents the redemption clause. This view stands fully fortified from the
relevant law laid down through an authority, ILR 1992 All 524, Ajit Singh v.
Kakhbir Singh and Ors. As such the argument advanced on behalf of the
defendants on this account must fail. The case of the plaintiff could not be
resisted on any other cogent ground.
7. The plaintiff-respondent was held to have proved that he was entitled to get whole of
the disputed land redeemed by payment of the mortgage money of Rs. 7,000/- to the
appellants-defendants. In view of positive findings on Issue Nos. 1 and 2 in favour of
the plaintiffs, Issue No. 3 was decided against the defendants and suit decreed as
noticed earlier. The appellate court also decided on facts that the plaintiff after the
purchase of the land, the subject matter of the suit, had become mortgagor and was
entitled to redeem the same prior to the period of 99 years fixed in the mortgage deed.
The clog or fetter of redemption imposed in the mortgage deed was held to be void
which did not prevent the plaintiffs to seek redemption of the mortgaged property prior
to the aforesaid period.
8. Section 60 of the Transfer of Property Act provides that at any time after the money
has become due, the mortgagor has a right, on payment or tender, at a proper time and
place of the mortgagor-money to require the mortgagee to deliver the mortgage-deed
and all documents relating to the mortgaged property and where the mortgagee is in
possession of the mortgaged property, to deliver possession thereof to the mortgagor.
Such a right of the mortgagor is called, in English Law, the equity of redemption. The
mortgagor being an owner who has parted with some rights of ownership has a right to
get back the mortgage deed or mortgaged property, in exercise of his right of
ownership. The right of redemption recognised under the Transfer of Property Act is
thus a statutory and legal right which cannot be extinguished by any agreement made at
the time of mortgage as part of the mortgage transaction.
9. This Court in Jayasingh Dnyanu Mhoprekar and Anr. v. Krishna Babaji Patil and Anr.
MANU/SC/0280/1985 : AIR1985SC1646 held:
It is well settled that the right of redemption under a mortgage deed can come
to an end only in a manner known to law. Such extinguishment of the right can
take place by a contract between the parties, by a merger or by a statutory
provision which debars the mortgagor from redeeming the mortgage. A
mortgagee who has entered into possession of the mortgaged property under a
mortgage will have to give up possession of the property when a suit for
redemption is filed unless he is able to show that the right of redemption has
come to an end or that the suit is liable to be dismissed on some other valid
ground. This flows from the legal principle which is applicable to all mortgages,
namely "once a mortgage, always a mortgage.
1 0 . Any provision incorporated in the mortgage deed to prevent or hamper the
redemption would thus be void. A mortgage cannot be made irredeemable and the right
of redemption not an illusory. This Court in Ganga Dhar v. Shankar Lal
MANU/SC/0118/1958 : [1959]1SCR509 held:
The rule against clogs on the equity of redemption is that, a mortgage shall
always be redeemable and a mortgagor's right to redeem shall neither be taken
away nor be limited by any contract between the parties. The principle behind
the rule was expressed by Lindley M.R. in Santley v. Wilde (1899) 2 Ch. 474 in
these words:

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 The principle is this: a mortgage is a conveyance of land or an
assignment of chattiest as a security for the payment of a debt or the
discharge of some other obligation for which it is given. This is the
idea of a mortgage; and the security is redeemable on the payment or
discharge of such debt or obligation, any provision to the contrary
notwithstanding. That, in my opinion is the law. Any provision inserted
to prevent redemption on payment or performance of the debt or
obligation for which the security was given is what is meant by a clog
or fetter on the equity of redemption and is therefore void. It follows
from this, that "once a mortgage, always a mortgage.
The right of redemption, therefore, cannot be taken away. The court will ignore any
contract the effect of which is to deprive the mortgagor of his right to redeem the
mortgage. One thing, therefore, is clear, namely, that the term in the mortgage
contract, that on the failure of the mortgagor to redeem the mortgage within the
specified period of six months the mortgagor will have no claim over the mortgaged
property, and the mortgage deed will be deemed to be a deed of sale in favour of the
mortgagee, cannot be sustained. It plainly takes away altogether, the mortgagor's right
to redeem the mortgage after the specified period. This is not permissible, for "once a
mortgage, always a mortgage" and therefore always redeemable. The same result also
follows from Section 60 of the Transfer of Property Act. So it was said in Mohammad
Sher Khan v. Seth Swami Dayal MANU/PR/0067/1921 : AIR 1922 PC 17.
An anomalous mortgage enable a mortgagee after a lapse of time and in the absence of
redemption to enter and take the rents in satisfaction of the interest would be perfectly
valid if it did not also hinder an existing right to redeem. But it is this that the present
mortgage undoubtedly purports to effect. It is expressly stated to be for five years, and
after that period the principal money became payable. This, under Section 60 of the
Transfer of Property Act, is the event on which the mortgagor had a right on payment of
the mortgage money to redeem.
The Section is unqualified in its terms, and contains no saving provision as other
Sections do in favour of contracts to the contrary. Their Lordships therefore see on
sufficient reason for withholding from the words of the Section their full force and
effect.
It was observed that the rule against clog on equity of redemption empowered the
courts to relieve a party from his bargain. If a person has agreed to forfeit wholly his
right to redeem in certain circumstances, that agreement will be avoided. After referring
to judgments in Vernon v. Bethell (1762) 2 Eden 110 : 28 ER 838.
Kreglinger v. New Patagonia Meat and Cold Storage Company Ltd. (1914) AC 25 this
Court held:
The reason then justifying the court's power to relieve a mortgagor from the
effects of his bargain is its want of conscience. Putting it in mere familiar
language the Court's jurisdiction to relieve a mortgagor from his bargain
depends on whether it was obtained by taking advantage of any difficulty or
embarrassment that he might have been in when he borrowed the moneys on
the mortgage. Was the mortgagor oppressed? Was he imposed upon? If he was,
then he may be entitled to relief.
We then have to see if there was anything unconscionable in the agreement that
the mortgage would not be redeemed for eighty-five years. Is it oppressive?

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 Was he forced to agree to it because of his difficulties? Now this question is
essentially one of fact and has to be decided on the circumstances of each case.
It would be wholly unprofitable in enquiring into this question to examine the
large number of reported cases on the subject, for each turns on its own facts.
The Court further held that the length of term by itself would not lead to the conclusion
that it was an oppressive term. Restricting their findings on the facts of the case, the
Court observed, "it is not necessary for us to go so far as to say that the length of the
term of the mortgage can never by itself show that the bargain was oppressive. We do
not desire to say anything on that question in this case. We think it enough to say that
we have nothing here to show that the length of the term was in any way
disadvantageous to the mortgagor.
1 1 . In Pomal Kanji Govindji and Ors. v. Vrajlal Karsandas Purohit and Ors.
MANU/SC/0372/1988 : AIR1989SC436 this Court held that "freedom of contract is
permissible provided it does not lead to taking advantage of the oppressed or depressed
people. The law must transform itself to the social awareness. Poverty should not be
unduly permitted to curtail one's right to borrow money on the ground of justice, equity
and good conscience on just terms. If it does, it is bad. Whether it does or does not,
must, however, depend upon the facts and the circumstances of each case". The
doctrine "clog on equity of redemption" was held to be a rule of justice, equity and
good conscience. It must be adopted to the reality of situation and the individuality of
transaction. The court should take note of the time, the condition, the price spiral, the
term bargain and the other obligations in the background of the financial conditions of
the parties. After referring to various judgments of the High Courts in the country this
Court held:
Whether in the facts and the circumstances of these cases, the mortgage
transaction amounted to clog on the equity of redemption, is a mixed question
of law and fact. Courts do not look with favour at any clause or stipulation
which clogs equity of redemption. A clog on the equity of redemption is unjust
and unequitable. The principles of English law, as we have noticed from the
decision referred to hereinbefore which have been accepted by this Court in this
country, look with disfavour at clogs on the equity of redemption. Section 60 of
the Transfer of Property Act, in India, also recognises the same position.
It is a right of the mortgagor on redemption, by reason of the very nature of the
mortgage, to get back the subject of the mortgage and to hold and enjoy as he
was entitled to hold and enjoy it before the mortgage. If he is prevented from
doing so or is prevented from redeeming the mortgage, such prevention is bad
in law. If he is so prevented, the equity of redemption is affected by that
whether aptly or not, and it has always been termed as a clog. Such a clog is
inequitable. The law does not countenance it. Bearing the aforesaid background
in mind, each case has to be judged and decided in its own perspective. As has
been, observed by this Court that long term for redemption by itself, is not a
clog on equity of redemption. Whether or not in a particular transaction there is
a clog on the equity of redemption, depends primarily upon the period of
redemption, the circumstances under which the mortgage was created the
economic and financial position of the mortgagor, and his relationship vis-a-vis
him and the mortgagee, the economic and social conditions in a particular
country at a particular point of time, custom, if any, prevalent in the community
or the society in which the transaction takes place, and the totality of the
circumstances under which a mortgage is created, namely, circumstances of the

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 parties, the time, the situation, the clauses for redemption either for payment of
interest or any other sum, the obligations of the mortgagee to construct or
repair or maintain the mortgaged property in cases of usufructuary mortgage,
to manage as a matter of prudent management, these factors must be
correlated to each other and viewed in a comprehensive conspectus in the
background of the facts and the circumstances of each case, to determine
whether these are clogs on equity of redemption.
12. It was further held that Section 60 of the Transfer of Property Act confers on the
mortgagor right of redemption which is a statutory right. The right of redemption is an
incident of a subsisting mortgage and it subsists so long as the mortgage subsists.
Whether in a particular case there is any clog on the equity of redemption, has to be
decided in view of the background of a particular case. The doctrine of clog on equity of
redemption has to be moulded in modern conditions. In this regard the Court held:
It is a settled law in England and in India that a mortgage cannot be made
altogether irredeemable or redemption made illusory. The law must respond
and be responsive to the felt and discernible compulsions of circumstances that
would be equitable, fair and just, and unless there is anything to the contrary in
the statute, law must take cognisance of that fact and act accordingly. In the
context of fast changing circumstances and economic stability, long term for
redemption makes a mortgage an illusory mortgage, though not decisive. It
should prima facie be an indication as to how clogs on equity of redemption
should be judged.
13. In the present case all the courts below on facts held that the mortgage deed being
for a period of 99 years was a clog on the equity of redemption. Such findings were
returned keeping in view the facts and circumstances of the case and the financial
position under which the mortgagor Shri Prakash Singh was placed at the time of
execution of the mortgage deed on 19.3.1968. The appellants were found to be in an
advantageous position qua the mortgagor. They were also found to be deriving the
usufructs of the mortgaged land for a period of over 26 years at the time of filing of the
suit on payment of meagre sum of Rs. 7,000/- only to the mortgagor. The findings of
the facts returned by the courts below do not require any interference particularly when
the learned Counsel appearing for the appellants has not contended that such findings
were perverse or uncalled for or against the evidence.
14. There is no merit in this appeal which is accordingly dismissed but without any
order as to costs.

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