(1) SA. 303.1992 IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT AURANGABAD SECOND APPEAL NO. 303 OF 1992 1] Chhabu S/o Gopala Ingale,Age 42 years, Occupation Agriculturist, R/o Vaijapur,District Aurangabad. APPELLANT V E R S U S 1] Manjaram S/o Chandrabhan Ingale, deceased by L.Rs. 1-A] Bhimabai W/o Manajram Ingale, Age 65 years, Occupation Agriculturist R/o Vaijapur,District Aurangabad. 1-B] Kadubai W/o Manajram Ingale,Age Major,Occupation Agriculturist R/o Vaijapur,District Aurangabad. 1-C] Asaram S/o Manjaram Ingale,Age 42 years,Occupation Agriculturist R/o Vaijapur,District Aurangabad. 1-D] Kachru S/o Manajram Ingale,age 41 years, Occupation Agriculturist R/o Vaijapur,District Aurangabad. 1-E] Dashrath S/o Manajram Ingale,Age 41 years,Occupation Agriculturist R/o Vaijapur,District Aurangabad. 1-F] Shivaji S/o Manjaram Ingale,Age 33 years,Occupation Agriculturist R/o Vaijapur,District Aurangabad. 1-G] Babasaheb S/o Manjaram Ingale,Age 34 years,Occupation Agriculturist R/o Vaijapur,District Aurangabad. 1-H] Devidas S/o Manajram Ingale, Age 25 years, Occupation Agriculturist R/o Vaijapur,District Aurangabad. (2) SA. 303.1992 1-I] Motilal S/o Manajram Ingale, Age 21 years,Occupation Agriculturist R/o Vaijapur,District Aurangabad. 1-J] Bhagubai W/o Chandrabhan Turkane, Age Major occupation household r/o Purangaon Ta. Vaijapur, 1-K] Gayabai W/o Ramrao Gayake, Age Major Occupation household,R/o Raghunathnagar Ta. Gangapur. 1-L] Tarabai W/o Sudam Gaware, Age Major Occupation household, R/o Raghunathnagar Taluka Gangapur. 2] Narayan S/o Savalaram Aher, Age Major Occupation agriculturist,R/o Vaijapur,District Aurangabad. RESPONDENTS WITH CIVIL APPLICATION NO. 2450 OF 1992 IN SECOND APEAL NO.303 OF 1992 Chhabu S/o Gopala Ingale, Age 42 years, Occupation Agriculturist, R/o Vaijapur, District Aurangabad. ..Applicant. V E R S U S Manjaram S/o Chandrabhan Ingale, deceased by L.Rs. And others ..Respondents WITH CIVIL APPLICATION NO. 2703 OF 1993 IN SECOND APEAL NO.303 OF 1992 Chhabu S/o Gopala Ingale, Age 42 years, Occupation Agriculturist, R/o Vaijapur, District Aurangabad. ..Applicant. (3) SA. 303.1992 V E R S U S Manjaram S/o Chandrabhan Ingale, deceased by L.Rs. And others ..Respondents ... Mr.Mujtaba Gulam Mustafa and Mr. A.G.Ansari, Advocates for the appellant/Applicants. Mr/ R.N.Dhorde,Advocate for respondent Nos.1B,1/C,1- G,1/F,1/H,1/I,1/L. Mr K.G.Nawandar ,Advocate for respondent No.2 Mr.V.P.Dhorde,Advocate for respondent No.2 ... CORAM : A.V. NIRGUDE, J. DATED : 22nd FEBRUARY, 2010 ORAL JUDGMENT :- 1] This second appeal is filed against the concurrent findings recorded by the Courts below. 2] The respondents-plaintiffs' case can be narrated as under:- . He said that he mortgaged his land survey no. 242/1 admeasuring 4A situated at Vaijapur, Dist. Aurangabad to the appellant-defendant on 10.5.1976 for a sum of Rs.2000/- by executing a conditional sale deed. He said that the conditional sale contemplated that in next 10 years, he was entitled to return the amount of Rs.2000/- and to take back the land. He said sometime prior to 30.5.1981 he offered Rs.2000/- to the appellant and requested him to deliver back the possession of the land and since he refused to do so, after giving a legal notice he (4) SA. 303.1992 filed this suit for recovery of possession and for redemption of the mortgage. The appellant-defendant resisted his claim by saying that the transaction was of absolute sale and not mortgage by conditional sale. The Courts below, however, did not accept his defence and decreed the suit. When the appeal was admitted, the following two grounds in the Appeal memo were held to be giving rise to the substantial question of law. 1] That, both the learned lower Courts committed illegality when they failed to appreciate the nice difference in between a document of conveyance of mortgage with a right to redeem and on failure to redeem within the fixed stipulated period, then the right having been conferred upon the mortgage to get the mortgage foreclosed, and a document of out and out sale deed with a right to repurchase within the stipulated fixed period therein, and on failure to exercise that right within that fixed period, the document becoming absolute sale free of any such conditions for all the time to come. It raises substantial question of law about the consequences which follow from document of registered mortgage deed with a right to redeem and repurchase the property by mortgagor within a time fied and allowed under that document and n failure the right of redemption to stand foreclosed, and the consquences in a registered document of sale deed with a condition to repurchase within the fixed period, and on failure to exercise that option and to repurchase within a a time fixed that resulting disappearance of that condition from that registered sale deed. 2] That, having held that it is a out and sale deed in view of 1982 Bombay with a right to (5) SA. 303.1992 repurchase, it is an illegality to hold and to decide at the same time that the registered sale deed is in fact a registered deed of mortgage. It is blowing hot and could in one and the same breath which is not permissible under law. Either it is a mortgage deed or it is a sale deed. It can not be both. And it raises a substantial question of law so as to the powers of both the courts below while passing final order whether they could have taken into consideration the principles of equity and could have held that the document in question is in fact document of mortgage with a right to redeem. In other words following substantial questions of law arose in this appeal. “Whether the transaction in the suit was mortgage by conditional sale, or it was out right sale with condition to repurchase ?" 3] Both the courts below held that, the transaction was a mortgage by conditional sale. In order to appreciate this aspect of the matter, one has to read the provisions of section 58(c) of the Transfer of Property Act, which defined the term 'mortgage by conditional sale'. The said provision reads as under - 58] ‘Mortgage’,‘mortgagor’,’mortgagee’’mortgage- money and mortgage-deed’ defined - (a) A mortgage is the transfer of an interest in specific immovable property for the purpose of securing the payment of money advanced or to be advanced by way of loan, an existing or future debt, or the performance of an (6) SA. 303.1992 engagement which may give rise to a pecuniary liability. The transferor is called a mortgagor, the transferee a mortgagee; the principal money and interest of which payment is secured for the time being are called the mortgage-money, and the instrument (if any) by which the transfer is effected is called a mortgage- deed. (b) .... (c) Mortgage by conditional sale.- Where the mortgagor ostensibly sells the mortgaged property- On condition that on default of payment of the mortgage-money on a certain date the sale shall become absolute,or On condition that on such payment being made the sale shall become void, or On condition that on such payment being made the buyer shall transfer the property to the Seller, The transaction is called a mortgage by conditional sale and the mortgagee a mortgagee by conditional sale: Provided that no such transaction shall be deemed to be a mortgage, unless the condition is embodied in the document which effects or purports to effect the sale. 4] In cases of such nature, one must read the document and appreciate the circumstances, in which the transaction had taken place, to find out the real intention of the parties when transaction took place. The gist of the document can be narrated as under:- (7) SA. 303.1992 It is titled as the ‘conditional Sale Deed’ of ten years period. It further says that, the respondent/plaintiff was in need of money to disburse some loan, to undertake the expenses of his agricultural operations etc. due to these needs he executed a conditional sale deed in favour of the appellant/original defendant. It further says that, the conditional sale was for a period of ten years and that respondent would receive an amount of Rs. 2000/-, as consideration of the transaction in presence of the Sub-Registrar. The other conditions of the transaction were as under-(1) The vendor had delivered the possession of land to the purchaser, (2) the purchaser would be entitled to use the water of the well by using electric pump set and he would be liable to spend costs of repairs of electric pump set to the extent of 1/4th share,(3) the vendor would wait for taking possession of the land till the crop is removed, (4) in case the vendor does not pay Rs. 2000/- within the time prescribed in the conditional sale deed, the conditional sale would be considered as permanent sale deed,(5) the vendor would be responsible for keeping the land unencumbered and without disturbance during the period of ten years. 5] On the face of it, the document in question would fulfill the definition of the term mortgage by conditional sale mentioned above. Obviously, the (8) SA. 303.1992 trial Court rightly put the burden to prove that the transaction was not mortgage but was out right sale on the appellant/defendant. In this back ground, one must appreciate the case of the appellant-defendant and the evidence, he led in support of the same. 6] The defence of the appellant, in short can be stated as under- He said that, the original respondent No.1 offered him the suit land admeasuring 4 Acres at the rate of Rs.2000/- per acre. Both of them then agreed that on the date of execution of the document, the original respondent No.1 would pay him a Rs.2000/-as an earnest amount and would receive the remaining consideration in next five years, and upon receipt of such amount he would execute a sale deed. With this agreement in mind, the parties approached to Advocate Shri Gaikwad. But he advised them to execute a conditional sale deed. The appellant further stated that despite of this sale deed he continued to pay certain installment to the original respondent No.1, in the next 4/5 years. He said that he repaid almost an over Rs.10,000/-to him. He further stated that when he suggested to the original respondent No.1 that he would take remaining amount and execute the sale deed in his favour, the respondent No.1 demanded more amount. He also said that, he was considering about filing a suit for specific performance against the respondent (9) SA. 303.1992 No.1. With this narration he stated that the said transaction was out right sale and not a mortgage with conditional sale. He recorded his deposition and mostly adhered to what he had stated in the written statement. But, the Courts below held that he could not prove that the transaction was out right sale. I am not inclined to disturb this finding because on facts the case of the appellant was not believable at all. On the other hand, Shri Gaikwad his own witness stated that when the parties approached him, he as per their agreement drafted the document in question. The document in question admittedly does not give any indication that the parties were entering into an agreement for sale. 7] The silent features of suit document are mentioned above, although the document does not specifically say that the consideration was a loan advanced to the respondent-vendor, all other ingredients of section 58(c) are present in the document. The main ingredient which is specifically mentioned in the document is that, on default of payment of amount on the date mentioned in the document the sale would became absolute. This clearly establish that the title of the land had not been transferred to the appellant/purchaser. It was deferred till the last date of period of ten years. (10) SA. 303.1992 8] Secondly, the document is ostensibly of a sale and it would be void, if payment is made within prescribed period, as contemplated by the provisions of section 58(c) of the Transfer of Property Act. 9] The appeal should, therefore, fail. The appeal stands dismissed. Consequently, the Civil Application Nos. 2450 of 1992 and 2703 of 1993 stand dismissed. Sd/- [A.V. NIRGUDE, J.] MTK/ok