Gujarat High Court
Maganlal Jesangbhai Thr'Heirs & Legal ... vs Fakirbhai M Solanki Since Deceased ... on 3 December, 2025
NEUTRAL CITATION
C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T
undefined
IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/FIRST APPEAL NO. 1382 of 1996
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE DEVAN M. DESAI
==========================================================
Approved for Reporting Yes No
==========================================================
MAGANLAL JESANGBHAI THR'HEIRS & LEGAL REPR. & ORS.
Versus
FAKIRBHAI M SOLANKI SINCE DECEASED THROGH LEGAL HEIRS &
ORS.
==========================================================
Appearance:
DECEASED LITIGANT for the Appellant(s) No. 1.1
DELETED for the Appellant(s) No. 1.4
MR VISHAL C MEHTA(6152) for the Appellant(s) No. 1.2,1.3,1.5,1.6
DECEASED LITIGANT THROUGH LEGAL HEIRS/ REPRESTENTATIVES
for the Defendant(s) No. 1.2
MR ASHISH H SHAH(2142) for the Defendant(s) No. 1.1
==========================================================
CORAM:HONOURABLE MR. JUSTICE DEVAN M. DESAI
Date : 03/12/2025
ORAL JUDGMENT
1. The present First Appeal is filed under Section 96 of the Code of Civil Procedure, 1908 (hereinafter, referred to as "the Code") by appellants - original defendants, challenging the judgment and decree dated 28.02.1996 passed by the City Civil Court, Court No. 20, Ahmedabad in Civil Suit No. 1102 of 1984. Page 1 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026
NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined
2. Heard learned advocate, Mr. Vishal Mehta for the appellants and learned advocate, Mr. Darshit Thakkar for learned advocate, Mr. Ashish Shah for the respondent. For the sake of convenience, parties are referred to as per their original status in the suit. Appellants are original defendants. Respondents are original plaintiffs.
3. The brief facts of the case are as under:
3.1 The plaintiff had filed a suit for recovery of possession of the suit property bearing tenement No. 2 situated in Panghat Co-operative Housing Society Limited, Shahibaug, Ahmedabad. The parties are cousin brothers. Plaintiff was in need of money as he had incurred debts of the society, borrowed an amount of Rs.6,400/- from the defendant. An unregistered writing in the nature of mortgage was executed between plaintiff and defendant on 05.07.1970, with a condition that from 01.07.1970, within a period of six years, i.e. 30.06.1976, plaintiff shall repay the said amount, failing which, after the expiry of six years, the suit property shall be mutated and transferred in the name of defendant in the Page 2 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined society records. In case the amount borrowed is returned back to defendant within a period of six years, the defendant shall hand over possession back to plaintiff and the defendant shall not have any right, title or interest over the suit property. As plaintiff was in need of more money, as a security deposit, an unregistered agreement to sell dated 05.12.1972 was executed between the parties. Sale price was agreed at Rs.14,000/- and, the amount of Rs.6,400/-, which was received by plaintiff pursuant to the unregistered mortgage agreement was to be adjusted and the remaining amount was paid by defendant against the loan and the expenses towards the construction of the property. An amount of Rs.1,350/- which remained due, was agreed to be paid by defendant to the plaintiff on 20.02.1973. It was agreed that on paying the remaining amount of Rs.1,350/-, the suit property shall be transferred in the name of defendant in the society records. As the disputes cropped up between the parties, members of the society intervened as arbitrators and resolved the dispute by getting an agreement in the year 1978 and it was agreed between the parties that plaintiff shall pay Rs.15,000/- to defendant and on payment Page 3 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined of Rs.15,000/-, the defendant shall hand over possession of the suit property back to the plaintiff. The plaintiff received a notice on 18.02.1984 from the defendant which was replied to. Thereafter, the plaintiff filed the suit for redemption of mortgage and seeking possession of the suit property. The defendant resisted the suit by filing written statement at Exhibit - 15 and denied the contentions of the plaintiff. The defendant raised an issue of limitation, and contended that the plaintiff has resigned as a member of the society, and thereby has lost title to the property. The plaintiff also executed an agreement to sell dated 04.12.1972 and accepted consideration of Rs.13,650/-. On the basis of pleadings following issues were framed by the learned Trial Court at Exhibit - 58:
1. Whether the plaintiff proves that the writing executed by the plaintiff in favour of the defendant in the year 1972 was only for the safety of the amount to money of the defendant advanced as loan to the plaintiff and that writing was not to be acted upon as agreement to sell?
2. Whether the plaintiff is entitled to recover the vacant possession of the suit premises which is tenement no. 2 in Panghat Co-op. Housing Society Limited situated at Shahibaug, Ahmedabad from the defendant?
3.Whether this suit is time barred?
4. Whether this suit is bad for non-joinder of necessary parties?
5. Whether this suit is barred by delay, laches, acquiescence and estoppel?
6. Whether the defendant proves that the agreement to Page 4 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined sell was executed by the plaintiff on 04.12.1972 in favour of the defendant with respect to the suit premises and whether the plaintiff has agreed to sell the suit property to the defendant at the market rate prevailing at the relevant time and whether the defendant has paid the amount of Rs.13,650/- to the plaintiff on 05.12.1972 which is the entire amount of consideration as alleged by the defendant?
7. What order?
Plaintiff examined himself at Exhibit - 66 and also examined two witnesses namely, Prabhudas Lakshmansinh at Exhibit - 79 and Jayantilal Chunilal Patel at Exhibit - 82. Defendant examined witness, Karsanbhai Maganbhai Chauhan at Exhibit - 90. Pending the suit, original defendant expired and therefore, the heirs of deceased defendant were brought on record. After considering the evidence, learned Trial Court decreed the suit by directing plaintiff to pay Rs.15,000/- to defendant and defendant is directed to hand over possession of the suit property back to plaintiff on receiving the amount of Rs.15,000/- within three months. 3.2 Being aggrieved and dissatisfied with the impugned judgment and decree, defendants - appellants have filed the present First Appeal.
Page 5 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026
NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined
4. Learned advocate for the appellants - defendants contended that the alleged Mortgage Deed, Exhibit-75, dated 05.07.1970, executed between the parties in respect of the suit property, is a usufructuary mortgage within the meaning of Section 58 of the Transfer of Property Act, 1882, (hereinafter, referred to as "the Act") as admittedly, at the time of execution of the said mortgage deed, the possession of the suit property was handed over to the predecessor of the appellant and he was authorised to retain such possession until payment of the mortgage money.
5. It is further contended that the Mortgage Deed, dated 05.07.1970 is not valid and is inadmissible in evidence as per statutory and mandatory provisions of Section 59 of the the Act, which clearly stipulates that where the principal money secured is one hundred rupees or upwards, a mortgage, other than a mortgage by deposit of Title Deeds, can be effected only by a registered instrument signed by the mortgagor and attested by at least two witnesses, and in the facts of the present case, the alleged Mortgage Deed, Exhibit - 75, is not a registered document and therefore, the present suit for redemption of the said mortgage based on invalid and inadmissible Mortgage Deed, Exhibit - 75, is Page 6 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined not maintainable in the eyes of law as per the provisions of Section 49 of the Registration Act, 1908.
6. It is further contended that upon execution of agreement to sell, Exhibit - 78, dated 05.12.1972 by the plaintiff in favour of defendant, the alleged Mortgage Deed, Exhibit - 75, merges into the said document of agreement to sell. Therefore, no suit can be filed on the basis of the said Mortgage Deed, Exhibit - 75. It is contended that the plaintiff has neither denied execution of the agreement to sell, Exhibit - 78 nor covenants of the said agreement. The plaintiff, however, has failed to seek any relief in the present suit for cancellation of the said agreement to sell. It is submitted that the execution of the alleged settlement at Exhibit - 68, is specifically denied by the defendant as no such settlement has been entered into between the parties. The plaintiff had tried to pay the amount of Rs.15,000/- allegedly agreed between the parties prior to the expiry of the period mentioned therein but, the defendant had refused to accept the said amount. However, the plaintiff had neither sent any notice or communication to the defendant with that regard nor initiated any proceedings in the present suit for specific performance of the said settlement. Page 7 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026
NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined
7. It is contended that in the alternative, even if, the prayer sought for in the present suit can be considered as specific performance of the said settlement, Exhibit - 68, then also, the said prayer is expressly time-barred and barred by law of Limitation as per Article 54 of the Limitation Act, 1963 which clearly stipulates the period of 3 years from the date fixed for the performance of the said settlement, Exhibit - 68, for filing the suit for specific performance. It is submitted that admittedly, the date fixed in the said settlement, Exhibit - 68, was 15.12.1978 for performance and the present suit is filed in the year 1984, i.e., beyond the period of 3 years as provided under Article 54 of the Limitation Act, 1963.
8. It is further contended that admittedly, the possession of the suit property has been legally and validly handed over by the original plaintiff to the original defendant, pursuant to the Mortgage Deed, Exhibit - 75, and agreement to sell at Exhibit - 78, the original defendant is entitled to protect his legal and settled possession over the suit property under the provisions of Section 53A of the Act, even in absence of any suit for specific performance of the said agreement to sell, as the conditions Page 8 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined mentioned in Section 53A have duly been complied with by the original Defendant.
9. Learned advocate for the appellants - defendants has relied upon the following decisions:
(1)"Haryana Financial Corporation vs. Gurcharan Singh"
reported in 2013(0) AIJEL - SC 54740.
(2)"Shrimant Shamrao Suryavanshi vs. Pralhad Bhairoba Suryvanshi" reported in 2002(0) AIJEL - SC 26028.
(3)"Vaghela Raghuvirsinh vs. Pratapba Wd/o Adesinh Dalalbhai" reported in 2013(0) AIJEL - HC 229237.
10. Per contra, learned advocate for the respondent - original plaintiff submitted that the plaintiff is a member of Panghat Co- operative Housing Society Limited, Shahibaug. The Society allotted Tenement No. 2 to the plaintiff, thereby making him its owner. It is submitted that the plaintiff and the defendant are cousin brothers. Plaintiff was in need of money, therefore, he borrowed money from the defendant. It is contended that on 05.07.1970, plaintiff executed an agreement in favour of the Page 9 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined defendant, which contained two conditions. The first condition was that, upon receiving the amount of Rs.6,400/- from the defendant, the plaintiff would hand over the possession of the suit property to the defendant, and the plaintiff had to repay the amount on or before 30.06.1976. If the plaintiff failed to repay the amount within the stipulated time, he had to transfer defendant's name into the society records. The second condition was that, if the plaintiff repays the amount of Rs.6,400/- within the stipulated period, i.e., on or before 30.06.1976, the defendant would hand over possession back to the plaintiff. As the conditions for sale and repurchase were in a single document, the transaction is a mortgage by conditional sale. Under this agreement, the defendant lent Rs.6,400/- to the plaintiff, and in return, the plaintiff handed over possession of the suit property to the defendant and the defendant remained in possession of the suit property under this agreement. It is further contended that after examining the agreement dated 05.07.1970 (Exhibit - 75), it is clear that a debtor-creditor relationship existed between the parties and that the agreement was executed only for security purposes. Page 10 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026
NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined
11. It is further contended that the plaintiff needed more money and therefore requested the defendant to lend him an additional amount, to which the defendant agreed on the condition that the plaintiff executed an agreement to sell in his favour for security purposes. Accordingly, on 05.12.1972, the plaintiff executed an agreement to sell in favour of the defendant only to secure the borrowed money given to plaintiff by the defendant, and the plaintiff had no intention to sell the property to the defendant.
12. It is further contended that Section 58(c) of the Act states that when a sale and an agreement to repurchase are embodied in a single document, the transaction is considered as a mortgage by conditional sale. The agreement dated 05.07.1970 therefore is a mortgage by conditional sale. Right to redeem was accrued to the plaintiff on 30.06.1976. Since the document is a mortgage deed, it is contended that the limitation period to redeem the mortgage is 30 years under Article 61(a) of the Limitation Act, 1963. The plaintiff filed the suit in 1984, and therefore, the suit of the plaintiff is within the period of limitation.
Page 11 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026
NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined
13. It is further contended that in the year 1976, the plaintiff approached the defendant to repay the borrowed amount, but the defendant refused to accept the money. The members of the society intervened and settled the matter between the parties through a settlement executed on 15.08.1978. Under this settlement, the plaintiff had to pay Rs.15,000/- to the defendant within four months, i.e., on or before 15.12.1978. If the plaintiff failed to do so, he had to transfer the property to the defendant without any objection. The plaintiff had to deposit Rs.15,000/- with the panchas, and thereafter, the defendant had to hand over the possession of the suit property. If the defendant failed to hand over the possession of the suit property, the plaintiff would be entitled to interest from the defendant. It is contended that the agreement to sell dated 05.12.1972, Exhibit - 78, was executed only for security purposes. If the plaintiff failed to pay Rs.15,000/-, he had to transfer the suit property to the defendant. It is further contended that the defendant, however, did not act in accordance with the settlement and did not hand over the possession of the suit property to the plaintiff. It is submitted that the defendant issued a legal notice on 18.02.1984, and the plaintiff replied to the said notice. It is contended that despite the legal notice, the defendant Page 12 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined did not hand over possession of the suit property to the plaintiff. The plaintiff therefore filed a Suit seeking redemption of the mortgage of the suit property after making payment of Rs.15,000/- or any amount directed by the Hon'ble Court.
14. Learned advocate for the respondent has relied upon the following decisions with regard to unregistered mortgage by conditional sale deed and period of limitation:
(1)"Patel Ravjibhai Bhulabhai (Dead) through legal representatives vs. Rahemanbhai M. Shaikh (Dead) through legal representative and Others" reported in 2016 (12) SCC 216.
(2)"Bhimrao Ramchandra Khalate (Deceased) through legal representative vs. Nana Dinkar Yadav (Tanpura) and Another" reported in 2021 (9) SCC 45.
(3)"Vithal Tukaram Kadam And Another vs. Vamanrao Sawalaram Bhosale And Others" reported in 2018 (11) SCC 172.
(4)"Aminabibi wd/o Rahemanbhai Mohamadbhai Shaikh vs. Sushilaben d/o Patel Ravjibhai" reported in 2013 (1) GLR 595.Page 13 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026
NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined
15. In the case of Patel Rajiv Bhai (Supra), the Hon'ble Apex Court has held that actual transaction between parties indicate that the property shall be given back on repayment within a period of five years. Actual transaction between parties was a loan and the relationship of debtor and creditor existed. The deed was of mortgage by conditional sale and not of sale with option of repurchase. Reliance has been placed upon para No. 8 of the decision which distinguishes features between mortgage by conditional sale and sale with an option to repurchase and the same is reproduced hereunder:
"8. Distinguishing features between 'mortgage by conditional sale' and 'sale with an option to repurchase' are enumerated in Mulla's Transfer of Property Act (11th Edition) as under:-
"(i) In a mortgage with conditional sale, the relation of a debtor and a creditor subsists while in a sale with an option of re-purchase, there is no such relationship and the parties stand on an equal footing.
(ii) A mortgage by conditional sale is effected by a single document, while a sale with an option of repurchase is generally effected with the help of two independent documents.
(iii) In a mortgage with conditional sale the debt subsists as it is a borrowing arrangement, while in a sale with an option of repurchase, there is no debt but a consideration for sale.
(iv) In a mortgage with conditional sale, the amount of consideration is far below the value of the property in the market but in a sale with an option of repurchase the amount of consideration is generally equal to or very near to the value of the property.
(v) In a mortgage with conditional sale, since this is a mortgage transaction, the right of redemption subsists in favour of the mortgagor despite the expiry of the time Page 14 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined stipulated in the contract for its payment. The mortgagor has the option to redeem the mortgage and take back the property on the payment of the mortgage money, after the specified time, but in a sale with an option of re-
purchase, the original seller must re-purchase the property within the stipulated time period. If he commits a default the option of re-purchase is lost."
16. In the case of Bhimrao Ramchandra (Supra), the Hon'ble Apex Court has held that if the advance of loan and return thereof are part of the same transaction, it creates a relationship of debtor and creditor, whereas the intention of the parties was to create a document of mortgage by conditional sale.
17. In the case of Vitthal Tukaram (Supra), the Hon'ble Apex Court has held that limitation for a suit of mortgage to redeem or to recover possession of immovable property mortgaged is 30 years when the right to redeem or to recover possession accrues.
18. In the case of Aminabibi wd/o Rahemanbhai (Supra), the Co-ordinate Bench of this Court held that the intention of the parties must be gathered from the language of the mortgage deed and that the nomenclature of the deed is not a conclusive factor. When there is no condition that, in case the payment is not made, transactions would become a sale, it is a mortgage with conditional Page 15 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined sale. The condition that, if payment is not made with time specified, right of redemption will be lost, is a clog on redemption, and the right of redemption cannot be extinguished by an unregistered agreement.
19. It is further contended that the agreement dated 05.07.1970 is an unregistered mortgage deed. The defendant took possession of the suit property by way of the said unregistered mortgage deed and remains in possession of the suit property till date. It is further submitted that the defendant cannot now, after 50 years of possession of the suit property, raise contentions regarding the document's lack of registration. It is submitted that the defendant continues to remain in possession of the suit property even today. Except above, no other submissions were canvassed by learned advocate for the respondent - plaintiff.
20. Having considered the submissions canvassed by learned advocates for the parties and on perusal of the record and proceedings, it appears that the plaintiff had filed a suit for redemption of an unregistered mortgage deed Exhibit - 75 dated 05.07.1970. The plaintiff has stated that as he was in need of Page 16 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined money, and therefore, approached his cousin brother, who is original defendant. Original defendant lent him Rs.6,400/-. A deed in the form of the mortgage was executed between the parties. The deed Exhibit - 75 stipulates that the amount shall be returned to the defendant within the period of six years from 01.07.1970, failing which, the suit property shall be transferred and mutated in the name of defendant in the society records. If the plaintiff repays the amount within the stipulated period of six years, the defendant shall return the possession of the suit property back to the plaintiff. As the plaintiff was in need of more money, by an execution of agreement to sell, dated 05.12.1972, Exhibit - 78, defendant and plaintiff agreed to confirm the price of the suit property at Rs.14,000/- and the amount of Rs.6,400/- which was given by defendant to plaintiff on 05.07.1970 was agreed to be adjusted towards the sale consideration. The defendant, under the agreement to sell agreed to pay the loan amount on behalf of the plaintiff and other expenses towards the construction of the house. The defendant agreed to clear the loan of the Ahmedabad People's Co-opeartive Bank for and on behalf of the plaintiff. Out of the total consideration of Rs.14,000/-, an amount of Rs.1,350/- remained due and payable by defendant to the plaintiff which was Page 17 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined to be paid on or before 20.02.1973. So far as the unpaid amount of consideration to the tune of Rs.1,350/- is concerned, it is not in controversy that the defendant did not pay remaining amount. This position is clear on perusing Exhibit - 78, agreement to sell. In the agreement to sell, on the last page, there is handwritten endorsement indicating that the remaining amount has been received by the plaintiff from defendant. The evidence indicates that as disputes cropped-up between the plaintiff and defendant, by way of an arbitration, the members of the society intervened and the parties to the suit arrived at a settlement which was reduced into writing on 21.02.1978, Exhibit - 68. It was agreed between the plaintiff and defendant by the said agreement that the plaintiff shall pay an amount of Rs.15,000/- to the defendant within a period of four months, commencing from 15.08.1978 till 15.12.1978. It was also agreed between the parties that the amount shall be given to the panchas and on handing over possession of suit property by defendant to the plaintiff, the panchas shall give the amount to the defendant. It is one of the core stipulation of the agreement that if plaintiff fails to pay the agreed amount of Rs.15,000/- within the stipulated time, the suit property, without any objection, shall be transferred in the name of Page 18 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined defendant in the society records. The agreement also stipulates that even after payment of the agreed amount by plaintiff, if defendant does not vacate the suit property, and hand over the possession of the suit property to the plaintiff, plaintiff shall be entitled to interest from the said date. It is the contention of the plaintiff in the oral deposition that though, plaintiff approached the defendant for payment of Rs.15,000/-, defendant refused to accept the amount and did not vacate the suit premises. The record is silent as to what transpired between the parties from 15.12.1978, till the Notice dated 18.02.1984. Notice dated 18.02.1984 is not placed on record by either of the parties. However, a reply to the said Notice, dated 25.02.1984, is placed on record at Exhibit - 69. In the said reply, the plaintiff has not pleaded a contention that the amount of Rs.15,000/- was offered in the year 1978 which was refused by defendant. In the plaint also, it is not a case put up that the amount of Rs.15,000/- was offered to defendant, and defendant has refused to accept such amount. Any factual statement made in the examination-in-chief without there being any base in the pleadings, cannot be considered as a proved fact, unless it is expressly proved or other side has admitted such fact, for the reason that the party who alleges a factual contention in Page 19 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined affidavit in lieu of examination-in-chief must plead such facts in the pleadings so that the opposite party gets an opportunity to meet with such facts. The witnesses who have been examined by the plaintiff in support of the contention that the plaintiff had approached the defendant for offering the amount and the said offer was turned down by the defendant is not a reliable evidence. In as much as, the plaintiff was required to deposit the amount of Rs.15,00/- with the panchas within a period of four months as agreed in the agreement.
21. It is the contention of the learned advocate for the respondent that the agreement to sell was executed for the security of the money which was lent by defendant to the plaintiff and the parties never intended to get the sale deed through successfully. If such contention is accepted, there is no explanation as to what was the need and purpose of accepting the remaining amount of Rs.1,350/- as an outstanding amount of consideration from the defendant. In the plaint, the allegation of the plaintiff is that for the security of the money, the agreement to sell of the year 1972 was executed between the parties, such contention is not only misconceived but the same is without any Page 20 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined evidence, for the reason that the plaintiff has not sought for the cancellation of the agreement to sell of the year 1972 when the so- called attempt was made by the plaintiff to offer an amount of Rs.15,000/- to the defendant and defendant refused to accept. The agreement to sell dated 21.02.1978, Exhibit - 68, as observed hereinabove, is an outcome of a settlement through the intervention of the other members of the society. The story, which the plaintiff has tried to develop during the examination-in-chief, that the plaintiff had offered the amount mentioned in the agreement but defendant refused to accept it, even if, this contention is accepted on face of it is against the terms and conditions of agreement dated 21.02.1978 (Exhibit - 68). The said agreement stipulates that on failure of defendant to return back the possession of the suit property, plaintiff is entitled to interest on the amount of Rs.15,000/-. The plaintiff, as per the agreement is not entitled to get back the possession of the suit property, but entitled to receive interest on Rs.15,000/-. The plaintiff has not prayed for the execution of such an agreement, Exhibit - 68, but admittedly filed a suit for redemption of an unregistered mortgage deed, Exhibit - 75. On the question of the mortgage deed being an unregistered deed, there is no dispute between the parties. Two Page 21 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined vital controversies arise in this Appeal. The bone of contention of learned advocate for the appellant on the mortgage agreement dated 05.07.1970, is that a suit for redemption of mortgage based on an unregistered mortgage deed is not maintainable as contemplated under Section 59 of the Act. Learned advocate for the respondents, opposing such contention, has relied upon a decision in the case of Aminabibi wd/o Rahemanbhai (Supra) and relied upon para No. 21 of the said decision which is reproduced hereunder:
"21. In the case on hand, it is an undisputed fact that the document Exh. 37 is not a registered document. In fact, when there is no independent registered agreement between the parties tor transferring right, title and interest in favour of mortgagee, simple agreement between the parties whereby the mortgagor agreed to forgo his right to take back the property could not be taken as extinguishment of right of mortgagor to redeem the mortgage. Not only this but such agreement reflecting act of mortgagor not to take back the property in future on acceptance of further amount of Rs.1,500/- could as well be termed as clog on equity to redeem the mortgage. I am, therefore, of the view that irrespective of the term provided in the mortgage-deed itself as well as irrespective of the execution of document at Exh. 37, the right of the appellants to redeem the mortgage would still survive and neither by term in the original mortgage-deed nor by subsequent execution of agreement Exh. 37, the rights of the appellants to redeem the mortgaged property have been extinguished."
22. With utmost respect to the Co-ordinate Bench of this Court Bench and the view expressed by the Co-ordinate Bench of this Page 22 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined Court, I am of the view that the Co-ordinate Bench had no occasion to consider Section 59 of the Act and Section 49 of the Registration Act. The Co-ordinate Bench was considering the issue whether the transaction is mortgage with conditional sale or sale with a condition to re-transfer. It has been held by the Co- ordinate Bench of this Court that in absence of any condition that if payment is not made with the time specified, right of redemption will be lost is a clog on redemption and the condition is invalid. Right of redemption cannot be extinguished by an unregistered agreement. On the question as to the mortgage is a mortgage by conditional sale or a usufructuary mortgage. Provisions contained in the Transfer of Property Act relating to mortgage is required to be considered. Section 58 of Chapter 4 of the Act deals with mortgages of immovable property and charges. Sub-clause (a) of Section 58 defines mortgage as:
"(a) A mortgage is the transfer of an interest in specific immoveable 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 engagement which may give rise to a pecuniary liability."
22.1 Mortgage, as defined in the aforesaid provision, means a transfer of an interest in specific immoveable property for the purpose of securing the payment of money advanced or to be Page 23 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined advanced by way of loan, an existing or future debt or the performance of an engagement which may give rise to a pecuniary liability. To construe a transaction that of a mortgage, the provision mentions that there has to be a transfer of interest for the purpose of securing payment of money advanced or to be advanced in future. In the present case, both the parties are on the same page that the transaction dated 05.07.1970, is a transaction of mortgage and the parties executed a deed of mortgage which is an unregistered deed. The question that remains now for consideration is whether the transaction is mortgage by conditional sale or a transaction of usufructuary mortgage. Clause (c) of Section 58 of the Act defines mortgage by conditional sale, which is reproduced hereunder:
"(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 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.]"
22.2 That, a mortgagor ostensibly sells the mortgage property on Page 24 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined condition of default of payment of mortgage-money, on a certain date, the sale becomes absolute or on payment of mortgage-
money, the sale shall become void. On payment being made, buyer shall transfer the property to the seller. If above conditions, or any of them, are satisfied, the mortgage is called a mortgage by conditional sale.
22.3 Clause (d) of Section 58 of the Act defines usufructuary mortgage:
"(d) Usufructuary mortgage.--Where the mortgagor delivers possession [or expressly or by implication binds himself to deliver possession] of the mortgaged property to the mortgagee, and authorises him to retain such possession until payment of the mortgage-money, and to receive the rents and profits accruing from the property [or any part of such rents and profits and to appropriate the same] in lieu of interest, or in payment of the mortgage - money, or partly in lieu of interest or partly in payment of the mortgage-money, the transaction is called an usufructuary mortgage and the mortgagee an usufructuary mortgagee."
22.4 In the case of usufructuary mortgage, the mortgagor delivers possession of the mortgage property to the mortgagee and authorises him to retain possession until payment of mortgage- money and further authorises to receive rents and profits accruing from the property in lieu of interest, or in payment of the mortgage- money the transaction is called usufructuary mortgage. In such Page 25 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined mortgage, on default of payment of the mortgage money or on payment of the mortgage-money, there is no such contingency of sale of mortgage property is prescribed in a type of usufructuary mortgage. The mortgagee shall retain possession only on payment of mortgage-money. The provision does not contemplate that in the eventuality of payment of mortgage-money, or on default of payment of mortgage-money, sale either becomes absolute or void.
23. In the present case, Exhibit - 78, is an unregistered mortgage for the security of money advanced by defendant to the plaintiff and the deed envisages a contingency that on default of payment of the mortgage-money, the suit property shall be transferred and mutated in the name of the defendant in the society records. There is also a clause in the agreement that in the eventuality that the plaintiff repays the mortgage-money to the defendant within the prescribed period of six years, possession of the suit property shall be handed over to the plaintiff. In both contingencies, the intention of the parties is crystal-clear that on non-payment of mortgaged money, the suit property shall be transferred in the name of defendant and on payment of mortgage- Page 26 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026
NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined money, the mortgagee shall hand over possession of the suit property to the mortgagor. In my opinion, the agreement dated 05.07.1970, Exhibit - 75, is a mortgage by conditional sale. The learned Trial Court has rightly held that the mortgage is a mortgage by conditional sale and findings on that aspect is upheld by this Court.
24. The next question which is required to be answered is the maintainability of the suit for redemption of mortgage on an unregistered mortgage deed. Before answering the question, it would be apposite to refer Section 59 of the Act, which is reproduced hereunder:
"Section 59. Mortgage when to be by assurance. Where the principal money secured is one hundred rupees or upwards, a mortgage [other than a mortgage by deposit of title-deeds], can be effected only by a registered instrument signed by the mortgagor and attested by at least two witnesses.
"Where the principal money secured is less than one hundred rupees, a mortgage may be effected either by [a registered instrument] signed and attested as aforesaid, or (except in the case of a simple mortgage) by delivery of the property."
24.1 The aforesaid provision mandates that where the principal money secured is one hundred rupees or upwards, a mortgage can be effected only by a registered instrument signed by Page 27 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined mortgagor and attested by at least two witnesses. There is an exception to the provision that a mortgage by a deposit of title deed for the security of money of one hundred rupees of upwards can be effected without the instrument being registered. As observed hereinabove, the instrument in question is a mortgage by conditional sale. Section 49 of the Registration Act, 1908 refers to the effect of non-registration of documents required to be registered. The same is reproduced hereunder:
"49. Effect of non-registration of documents required to be registered.
No document required by section 17 or by any provision of the Transfer of Property Act, 1882 (4 of 1882), to be registered shall--
(a) affect any immovable property comprised therein, or
(b) confer any power to adopt, or
(c) be received as evidence of any transaction affecting such property or conferring such power, unless it has been registered.
Provided that an unregistered document affecting immovable property and required by this Act or the Transfer of Property Act, 1882 (4 of 1882), to be registered may be received as evidence of a contract in a suit for specific performance under Chapter II of the Specific Relief Act, 1877 (3 of 1877) or as evidence of any collateral transaction not required to be effected by registered instrument."
24.2 The said provision envisages that no document required by any provision of the Transfer of Property Act to be registered shall affect any immovable property comprised therein or confer any Page 28 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined power to adopt or be received as evidence of any transaction affecting such property or conferring such power, unless it has been registered. The present controversy would fall within the third contingency namely, an unregistered deed shall not be received as evidence of any transaction affecting such property. Section 49 of the said Act bars the admissibility of any evidence which, otherwise, compulsorily to be registered under the provisions of the Transfer of Property Act. As referred above, Section 59 of the Act mandatorily requires an instrument to be registered signed by the mortgagor and attested by at least two witnesses for the security of money for rupees one hundred or upwards.
25. The contention raised by learned advocate for the respondent - plaintiff that the mortgage deed dated 05.07.1970 has been accepted and relied upon by the defendant - appellant and has accepted the possession of the suit property pursuant to an unregistered mortgage deed estops from raising a dispute regarding maintainability of the suit on the ground of unregistered mortgage deed. A reliance has been placed upon the case of "Kanbi Ladha Ukeda vs. Joshi Jestaram Gangaram" reported in 1970(0) AIJEL-HC 206068 wherein, the case before the Page 29 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined Hon'ble Division Bench of this Court was that the defendant raised a ground that the suit for redemption was not maintainable because the mortgage was created by an unregistered document. In para No. - 8 of the said decision, the Hon'ble Division Bench has observed that "the unregistered mortgage document, which is otherwise compulsorily registrable, cannot lay the foundation for a decree for redemption and therefore, if that was the only evidence for passing the decree for redemption, we would have upheld that contention raised by Mr. Y.S. Mankad. But in this case, the defendant has admitted in his evidence that he entered into possession of the suit lands as mortgagee. In other words, according to him, they had been mortgaged to him at the time when the unregistered mortgage document was executed. Having admittedly entered into possession of the lands in question as a mortgagee it is not open to the defendant to raise the plea of ownership by adverse possession." Considering the contention of defendant that defendant raised a plea of ownership by adverse possession, the Hon'ble Division Bench held that the defendant has admitted in his evidence that he entered into possession as a mortgagee. With utmost due respect to the view canvassed by the Hon'ble Division Bench of this Court, in the aforesaid decision, Page 30 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined whether the mortgage was a mortgage by deposit of title deeds or the mortgage was of any other types as contemplated under Section 58 is not clear. Only in the cases of mortgage by deposit of title deeds, an unregistered deed of mortgage is admissible in evidences as exception is carved out in Section 59 of the Act which permits a mortgage by deposit of title deeds which can be effected without a registered instrument. It is also noticed on perusal of the aforesaid decision that the defendant raised a plea of ownership by adverse possession. Such facts are missing in the present case.
26. In the case of Haryana Financial Corporation (Supra), the Hon'ble Apex Court was considering the question of a charge over property under Section 100 of the Act. It is the contention of learned advocate for the appellant that the said decision is applicable on the principle of law that a suit based on an unregistered instrument, which compulsorily requires registration under the provisions of the Act, is not maintainable. The Hon'ble Apex Court in para - 11 has observed as under:
"11. A conjoint reading of Section 100 with Section 59 of the TP Act makes it clear that if by act of parties, any immovable property is made security for the payment of Page 31 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined money to another and it does not amount to mortgage, then all the provisions which apply to a simple mortgage, as far as may be, apply to such charge. Consequently, in view of Section 59 of the TP Act when there is a mortgage other than a mortgage by deposit of the title deeds, it can be effected only by a registered instrument. So far as the present case is concerned, no registered mortgage deed was executed by the first respondent and no title deed of the property was handed over by the first respondent to the Corporation. The mere undertaking that a person would not dispose of the properties mentioned, during the currency of the loan, would not confer any charge on the immovable properties mentioned therein. In other words, a mere undertaking to create a mortgage is not sufficient to create an interest in any immovable property. This legal position has been settled by various judgments of this Court. In K. Muthuswami Gounder (supra), this Court was dealing with the legal validity of a security bond by which parties undertook that they would not alienate the properties till the decree was discharged.
Referring the said document, this Court held as follows :
"17. The document, Exhibit A-6, security bond does not in substance offer suit property by way of security. Even giving the most liberal construction to the document, we cannot say that a charge as such has been created in respect of the suit property for money to be decreed in the suit. All that it states is that in the event of a decree being passed not to alienate the property till the decree is discharged, which is a mere undertaking without creating a charge. Therefore, we agree with the finding of the High Court that the document at Exhibit A-6 is not a charge. If that is so, the suit filed by the appellant has got to be dismissed."
27. The Hon'ble Apex Court, while discussing on the issue of registration of a mortgage deed as contemplated under section 59 of the transfer of property act has held that a conjoint interpretation of Section 100 read with Section 59 of the Act, clarifies that the statutory provisions governing the creation of a simple mortgage Page 32 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined by delivery of possession shall equally apply to any charge upon immovable property. In the case of a mortgage other than a simple mortgage, the law mandates that the mortgage deed be executed and registered as a formal instrument in accordance with Section
59. Consequently, any charge created upon immovable property must satisfy the same registration requirement, failing which the charge shall not confer an enforceable interest in the property. The undertaking to create a charge, in absence of a registered mortgage deed does not vest any legal interest in the immovable properties. Relying upon the judgment in the case of K Muthuswami Gounder vs. N. Palaniappa Gounder reported in (1998) 7 SCC 327, the Hon'ble Apex Court affirmed that a security bond, lacking registration cannot operate as a charge enforceable under the Act.
28. In the case of Vaghela Raghuveer Singh (Supra), in para Nos. 15 and 19, the Co-ordinate Bench of this Court has observed as under:
"15. Having heard learned Advocates for the parties and having perused the judgments and decrees of the Courts below with record of the cases, it appears that the plaintiff in his suits has come out with a specific case that the father of the plaintiff had placed the suit property with the Page 33 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined husband of defendant No. 1 and father of defendant Nos. 2 to 7 by way of oral mortgage for an amount of Rs. 350/-. As against the above case of the plaintiff, the defendants have denied the title of the plaintiff and have come out with a specific case that they are owners of the suit property, and therefore, there is no question of redemption of mortgage of the suit property. As per the provisions of Section 59 of the Transfer of Property Act, mortgage other than mortgage by deposit of title-deed for principal money of more than Rs. 100/- can be effected only by registered instrument. In the present case, admittedly, principal money secured was Rs. 350/-, i.e. above Rs. 100/-, and as per the case of the plaintiff, the suit property was orally mortgaged with the husband of defendant No. 1 and father of defendant Nos. 2 to 7. The plaintiff has relied on entry made in the revenue record to establish the oral mortgage made by his father in favour of the husband of defendant No. 1 and father of defendant Nos. 2 to 7. The plaintiff has also relied on deposition recorded in Tenancy Case No. 198 of 1965, certified true copy of the same was produced at Exh. 49, of the deceased husband of defendant No. 1 and father of defendant Nos. 2 to 7 admitting the oral mortgage made by the father of the plaintiff in his favour. Trial Court has accepted the mortgage of the property by the father of the plaintiff in favour of the husband of defendant No. 1 and father of defendant Nos. 2 to 7 and found that the defendants have failed to prove title to the suit property and also held that the defendants could be said to be mortgagee and on that basis, the suits were allowed. However, the first appellate Court has come to the conclusion that there is no valid mortgage in the eye of law, and therefore, suits for redemption of the mortgage are not maintainable. In my view, the appellate Court has committed no error in holding that suits for redemption of oral mortgage for the money secured above Rs. 100/- were not maintainable."
"19. In the present case, the defendants have come out with a plea that they are owners of the suit property. The plaintiff in his evidence has not stated as to how his father or he was owner of the property, but he has simply stated that his father had orally mortgaged the suit property with the husband of defendant No. 1 and father of defendant Nos. 2 to 7 for Rs. 350/-. Trial Court while disbelieving the plea of the defendants about their ownership right considered the defendants as mortgagee of the plaintiff Page 34 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined and on that basis, held that the defendants cannot put up the plea of adverse possession. In such fact situation, if the suits of the plaintiff are found not maintainable for redemption of mortgage in absence of any valid mortgage of the suit property, the suits cannot be treated as title suits. Though in some respects, suit for possession and suit for redemption are similar but there are vital differences, also. In a suit for redemption, on proof of valid mortgage, redemption could be granted. Whereas in title suit, plaintiff is required to establish his title to the suit property. The period of limitation for a suit of redemption is 30 years under the Limitation Act of 1963, whereas, for suit for recovery of possession, period available is 12 years. In a suit for redemption, it is not open to the mortgagee to put forth plea of adverse possession, whereas in the suit for title, even if defendants fail to establish ownership right, they are on the basis of their long possession, entitled to claim ownership right if they are successful to establish possession of the suit properties in knowledge of and adverse to owners of the property. Thus, if defendants are successful to set up hostile title against the original owners, they can be held to be owners by adverse possession. Therefore, it may not be always permissible or convenient to treat the suit for redemption as a suit for possession but in given facts of the case, it may be permissible, like the one which was before the Hon''ble Supreme Court in the case of Kolathoor Variath (supra). It is required to be noted that while in the suit for redemption, averments in the plaint are pure and simple and issues framed are as regards mortgage of the property and time limit for filing the suit and if mortgage is accepted by the defendants, there may be limited defences available to the defendants, whereas in the suit for title, various defences are available to the defendants. Thus, if the suit for redemption is allowed to be converted in the suit for title to recover possession of the suit property, entire nature and character of the suit would be changed. For the above reasons, the plaintiff''s suits cannot be treated as title suits. The plaintiff having simply prayed for redemption of mortgage and since the defendants were prevented from taking various defences, the plaintiff cannot be made entitled for a decree of possession based on his title against the defendants."
The Co-ordinate Bench of this Court has observed that a suit Page 35 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined for redemption of mortgage, in absence of valid mortgage of the suit property, is not maintainable. The case before the Co-ordinate Bench was related to an allegation of oral mortgage which was believed by the learned Trial Court, but the First Appellate Court came to the conclusion that there is no valid mortgage. The view expressed by the First Appellate Court was affirmed by this Court by holding that the suit for redemption of mortgage on the basis of alleged oral mortgage is not maintainable as there is no valid mortgage in the eye of law.
29. Answering the contention of learned advocate for the appellant that under the provision of section 53 a of the Transfer of Property Act, the transferee who has taken possession over the property in part performance of the contract is entitled to protect his possession despite no suit for specific performance of the agreement to sell was filed within the period of limitation. In the case of Shrimant Shamrao (Supra), para Nos. 6, 14, 15, 16 and 18, the Apex Court has observed as under:
"6. A perusal of Section 53-A shows that it does not forbid a defendant-transferee from taking a plea in his defence to protect his possession over the suit property obtained in part performance of a contract even though the period of limitation for bringing a suit for specific performance Page 36 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined has expired. It also does not expressly provide that a defendant transferee is not entitled to protect his possession over the suit property taken in part performance of the contract if the period of limitation to bring a suit for specific performance has expired. In absence of such a provision, we have to interpret the provisions of Section 53-A in a scientific manner. It means to look into the legislative history and structure of the provisions of Section 53-A of the Act."
"14. But there are certain conditions which are required to be fulfilled if a transferee wants to defend or protect his possession under Section 53-A of the Act. The necessary conditions are-
1) there must be a contract to transfer for consideration any immovable property;
2) the contract must be in writing, signed by the transferor, or by someone on his behalf;
3) the writing must be in such words from which the terms necessary to construe the transfer can be ascertained;
4) the transferee must in part performance of the contract take possession of the property, or of any part thereof;
5) the transferee must have done some act in furtherance of the contract; and
6) the transferee must have performed or be willing to perform his part of the contract."
"15. We are, therefore, of the opinion that if the conditions enumerated above are complied with, the law of limitation does not come in the way of a defendant taking plea under Section 53-A of the Act to protect his possession of the suit property even though a suit for specific performance of a contract has barred by limitation."
"16. The matter may be examined from another angle. The established rule of limitation is that law of limitation is not applicable to a plea taken in defence unless expressly a provision is made in the statute. The law of limitation applies to the suits and applications. The various articles of the Limitation Act show that they do not apply to a defence taken by a defendant in a suit. Thus, the law of limitation bars only an action in a court of law. In fact, Page 37 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined what the Limitation Act does is, to take away the remedy of a plaintiff to enforce his rights by bringing an action in a court of law, but it does not place any restriction to a defendant to put forward any defence though such defence as a claim made by him may be barred by limitation and cannot be enforced in a court of law. On the said principle, a defendant in a suit can put forward any defence though such defence may not be enforceable in a court of law, being barred by limitation."
"18. It is, therefore, manifest that the Limitation Act does not extinguish a defence, but only bars the remedy. Since the period of limitation bars a suit for specific performance of a contract, if brought after the period of limitation, it is open to a defendant in a suit for recovery of possession brought by a transferor to take a plea in defence of part performance of the contract to protect his possession, though he may not able to enforce that right through a suit or action."
29.1 Learned advocate for the appellant contended that in a suit filed by the transferer for the recovery of possession of the suit property, a defendant-transferee can defend or protect his possession over the suit property obtained in part performance of an agreement to sell under Section 53A of the Act. The defendant- transferee is not precluded from taking a plea in defence to protect his possession over the suit property obtained in performance of a contract, even if the period of limitation prescribed under the Limitation Act has expired for bringing a suit for specific performance.
Page 38 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026
NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined
30. Even if the mortgagee has accepted possession on the basis of an unregistered mortgage by conditional sale, such unregistered deed cannot be accepted in evidence as it contravenes the provision of Section 49 of the Registration Act read with Section 59 of the Transfer of Property Act.
31. Thus, in the back-drop of the above discussion and in light of the facts and circumstances of the case, the First Appeal is allowed. The judgment and decree dated 28.02.1996 passed by the City Civil Court, Court No. 20 Ahmedabad in Civil Suit No. 1102 of 1984 is hereby quashed and set aside. Civil Suit No. 1102 of 1984 is hereby dismissed. No order as to costs.
32. Record and Proceedings be sent back to the concerned Court / Tribunal, forthwith.
33. Learned advocate for the respondent has requested to stay the operation and implementation of this order for six weeks. It is further contended that vide order dated 16.08.1996, appellant was directed to maintain status quo as to the possession and restrain from transferring, alienating and creating any other encumbrance Page 39 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026 NEUTRAL CITATION C/FA/1382/1996 JUDGMENT DATED: 03/12/2025 T undefined on this property.
34. As against this, learned advocate for the appellant raises an objection that in the end result, the suit of the plaintiff is dismissed.
35. Therefore, considering the facts, the request of the respondent is accepted for six weeks from the date of receipt of this order.
(D. M. DESAI,J) MUSKAN Page 40 of 40 Uploaded by MUSKAN AJAY MENON(HC02359) on Mon Dec 29 2025 Downloaded on : Fri Jan 02 20:31:50 IST 2026