S SRINIVASA AIYANGAR Vs. RADHAKRISHNA PILLAI

JUDGEMENT

(1.) This is an appeal against an Order of remand. The appellants are the defendants.

(2.) The plaintiff sued for redemption of a mortgage created in 1884. This mortgage document (Exhibit A) begins by calling itself a usufructuary mortgage and in two or three places in the course of the deed, it is expressly called a usufructuary mortgage deed. It, however, contains a clause that if the mortgage amount was not paid on a date which is stipulated in the document at an interval of exactly nine years from the date of the document the mortgage was to work itself out as a sale for the principal amount due on the mortgage bond. Possession was given to the mortgagee in accordance with the nature of the document and its spirit. At the end, there is a covenant to this effect. " I, the mortgagor, shall pay to you the costs of the construction of earth work . etc., on the date fixed for redemption as per your accounts along with the mortgage money."

(3.) The question is, what is the nature of this document? It is contended by the appellant s learned Vakil that this is a combination of three kinds of mortgages, a simple mortgage, a usufructuary mortgage and a mortgage by a conditional sale. The plaintiff s contention, on the other hand, is that it is a usufructuary mortgage with a covenant at the end clogging the equity of redemption. I am inclined to think that it is a combination of a simple mortgage and a usufructuary mortgage with a covenant clogging the equity of redemption. I think it cannot be called a mortgage by a conditional sale, as it was executed after the Transfer of Property Act came into force, and it does not come within the definition of a mortgage by a conditional sale found in Section 58 Clause (c) of the Transfer of Property Act. There is no ostensible sale of the mortgaged property on the date of the document. It is what was known as the Hindu form of a mortgage by a conditional sale before the Transfer of Property Act was enacted ; but it seems to me that the definition given in Section 58 Clause (c) of the Act was expressly framed so as to exclude this Hindu form of mortgage by conditional sale from the definition of mortgage by conditional sale in the Transfer of Property Act, That Hindu form of mortgage by conditional sale which began as a mortgage and worked itself out as a sale on breach of certain conditions by the mortgagor formed the subject of several decisions of the High Courts and the Privy Council, and because much confusion resulted from conflicts between those decisions, their Lordships of the Privy Council expressly stated in Thumbusatni Moodely v. Hussain Rowthen (1875) I.L.R. 1 M. 23. "An Act" of the Legislature " affirming the right of the mortgagor to redeem until foreclosure by a judicial proceeding, and giving to the mortgagee the means of obtaining such a foreclosure, with a, reservation in favour of mortgagees whose titles, under the law as understood before 1858, had become absolute before a date to be fixed by the Act, would probably settle the law without injustice to any party." I think that the Transfer of Property Act, so far as the Hindu form of mortgage by conditional sale was concerned, treated it as a mortgage either simple or usufructuary according to its terms and treated the condition as to its afterwards working out as a sale as not enforceable by enacting Section 60 in the Act which gives to mortgagors generally a right to redeem. A mortgage deed which begins as a mortgage transaction cannot, in my opinion, be called a mortgage by conditional sale, though it is a mortgage which gives the mortgagee after a certain time and on breach of certain conditions by the mortgagor a right to claim a title as vendee. It is a mortgage with a clause providing for a future conditional sale and not a mortgage by means of a present sale transaction.