1. This is defendants' second appeal against whom the suit for possession, by way of redemption, was dismissed by the trial Court, but has been decreed in appeal.
2. On 11-5-1962 Smt. Swaran Kaur entered into an agreement Exhibit D-2 with Massa Singh whereby she agreed to mortgage her agricultural land measuring 87 kanals for a sum of Rs. 5,500/- . A sum of Rs. 3,000/- was paid by way of earnest money. The registered deed was to be executed within fifteen days thereof. However on 16-5-1962, she executed the mortgage deed Exhibit P-1, for a sum of Rs. 7,000/- in favour of the predecessor-in-interest of the defendants-mortgagees. According to the terms of the mortgage deed, the mortgage was with possession and a usufructory mortgage; the period of mortgage was mentioned as 90 years. According to one of the conditions of the mortgage deed, it authorised the mortgagees to plant fruit bearing and other trees making the mortgagors liable to pay the price of the fruit bearing and other trees at the time of the redemption. Another condition of the mortgage deed was that the mortgagees was entitled to get their mortgage money at any time they liked. One Gurbax Singh filed a suit for pre-emption alleging the said mortgage to be sale. However, the suit was dismissed by the trial Court on 31-1-1964, vide certified copy of the judgment Exhibit DW 2/3. It was held by the trial Court in that suit that the transaction in dispute was virtually a sale. The suit was dismissed as the plaintiffs had failed of pre-emption. The decree of the trial Court was maintained in appeal vide its judgment dt. 27th Mar. 1965, certified copy of which is Exhibit DW 2/4. In appeal the learned District Judge reversed the finding of the trial Court and came to the conclusion that the mere fact that the mortgage in question is for a period of 90 years, could not be a cogent ground to term the mortgage as a sale. It was further observed that this document i.e. the mortgage deed, does not contain any onerous condition. Thus it was concluded that the transaction is question is a mortgage and not a sale. However, the decree of the trial Court was maintained as the finding of the trial Court to the effect that the plaintiffs have failed to prove their superior right of pre-emption, was affirmed. Later on the said Smt. Swaran Kaur sold her equity of redemption for a sum of Rs. 8,000/- in favour of the plaintiffs-Gopal Singh and others on 1st Oct. 1966. Out of the sum of Rs. 8,000/- , Rs. 7,000/- were left out for payment to the mortgagees at the time of redemption and only a sum of Rs. 1,000/- was paid to the mortgagor Smt. Swaran Kaur. The present suit has been filed on 29-4-1967 on behalf of Gopal Singh and others who purchased the equity of redemption from Smt. Swaran Kaur. It was alleged in the plaint that the sale deed dt. 1st Oct. 1966 executed in their favour authorised them to redeem the mortgage; that the period of 90 years barring redemption of the mortgage, was illegal, invalid, void, unlawful and a clog on the equity of redemption and was thus not binding on the plaintiffs; that the condition in the mortgage deed authorising the mortgagees to plant fruit bearing and other trees making the mortgagors liable to pay the price of fruit bearing and other trees, at the time of redemption, is also a clog on the equity of redemption; that the condition in the mortgage deed entitling the mortgagees to get the land mortgaged sold for the recovery of mortgage money forthwith irrespective of the restriction of ninety years, was also invalid, illegal and highly adverse to the mortgagors. Thus it was claimed that the plaintiffs were entitled to get the property redeemed on payment at Rupees 7,000/- .
3. The suit was contested by the defendants-appellants, wherein it was pleaded that the mortgage amount of Rs. 7,000/- had been correctly mentioned. It was admitted that in the agreement the mortgage amount of Rupees 5,500/- had been fixed, but with mutual consent, the amount of mortgage was subsequently raised to Rs. 7,000/- and the period of redemption was fixed as 90 years and out of this an amount of Rs. 3,000/- had been paid at the time of the agreement. It was denied that the provisions of the period of 90 years was a clog on the equity of redemption. Moreover, who are bound by the terms and conditions of mortgage and therefore, the present suit was premature. It was further pleaded that the condition of planting trees or the fruit bearing trees is the light which is incidental to the mortgage and such a right could not be termed as a clog on the equity of redemption.
4. On the pleadings of the parties, the trial Court framed the following issues:--
1. Whether the period of 90 years for redemption is a clog on the equity of redemption? OPP.
2. Whether the plaintiff purchased the equity of redemption. If so what effect? OPP.
3. If issues Nos. 1 and 2 are proved whether the plaintiff is not entitled to redeem? OPD.
4. If plaintiff is held entitled to redeem, what is the amount of mortgage payable? OPP.
5. Whether the condition in the mortgage deed authorising the mortgagee to plant fruit bearing and other trees and making the mortgagor liable to pay the price of improvement is a clog on the equity of redemption and is illegal, invalid, void and not binding on the plaintiff?
5B. Whether the condition in the mortgage deed entitling the mortgagee to get the land mortgaged sold for the recovery of mortgage money irrespective of 90 years restriction is invalid; illegal; void and unconscionable?
5. The trial Court found that the long term of 90 years in the present mortgaged deed could not be termed as a clog on the equity of redemption. As regards the other issues, the trial Court observed that in view of the statement of Massa Singh, defendant, made on 21-3-1969 that he was not prepared to lay out any garden on the suit land and if he does so then at the time of redemption he would not ask for any compensation nor would accept such compensation, Issue No. 5 was decided in favour of the plaintiffs and against the defendants. While discussing Issue No. 5B, the trial Court found that in view of the statement of Massa Singh defendant, that he would not demand mortgage amount before the expiry of the period of redemption nor would he get the mortgage land sold for the recovery of mortgage money, the issue was decided in favour of the plaintiffs and against the defendants. Ultimately finding that there was no clog on the equity of redemption, as per terms of the mortgage deed, the plaintiffs' suit was dismissed, being premature, and it was held that the plaintiffs shall be entitled to redeem the mortgage in dispute after the expiry of 90 years from the date of mortgage on payment of Rs. 7,000/- . In appeal, the learned Additional District Judge reversed the finding of the trial Court and came to the conclusion that reading of the three conditions in the mortgage deed together, amounts to a clog on the equity of redemption and therefore, the plaintiffs are entitled to redeem the land before the expiry of 90 years. Consequently, the plaintiffs' suit was decreed on payment of Rs. 7,000/- . Dissatisfied with the same, the defendants have come up in second appeal in this Court.
6. The sole question to be decided in this appeal is whether as per terms and conditions in the mortgage deed, a clog on the equity of redemption has been put or not. It is the common case of the parties and has also been found by the learned Appellate Court in the present case that the plaintiffs have relied upon covenants contained in the mortgage deed which accordingly amount to a clog on the equity of redemption on the ground that the terms were unconscionable, but use of any undue influence or fraud has not been relied upon. It may be mentioned that Smt. Swaran Kaur filed her written statement in the suit and also appeared as a witness for the defendant as DW 2. In the written statement filed by her she averred that an amount of Rs. 7.000/- as mentioned in the mortgage deed was fixed by mutual consent and on free will of the parties and was paid by the mortgagee to her and that she had authorised the plaintiffs to get the land redeemed after the period of mortgage fixed in the mortgage deed in dispute i. e. 90 years and that the plaintiffs were agreed to these terms at the time of sale of equity of redemption in their favour on 1st Oct. 1966. This stand taken by her in the written statement was affirmed by her while in the written box. It is also clear from her statement that she was not deriving any income from the land although the area is 87 kanals. Being a woman, Swaran Kaur could not possibly manage her affairs and according to the learned Additional District Judge, the mortgagees took undue advantage of her oppressed condition which in my opinion was unwarranted since it was nobody's case. However, the lower Appellate Court came to the conclusion that the term of 90 years coupled with the covenants authorising the mortgagees to plant any number of trees and claim their cost at the time of redemption and giving him the right to recover the mortgage amount by sale before the expiry of the period of 90 years tantamount to a clog on the equity of redemption and thus the plaintiffs were entitled to avoid the same.
7. After hearing the learned counsel for the parties and going through the case law cited at the bar. I am of the considered opinion that the approach to the lower Appellate Court is wrong and illegal and the judgment of the Supreme Court reported as Ganga Dhar v. Shankar Lal, AIR 1958 SC 770, has not been correctly applied to the facts of the present case. It has been held therein that ordinarily and in the absence of a special condition entitling the mortgagor to redeem during the term for which the mortgage is created, the right of redemption can only arise on the expiration of the specified period. In para 15 thereof, it has been observed that:--
'The reason then justifying the Court's power to relieve a mortgagor from the effects of his bargain is its want to conscience. Putting it in more 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.'
The matter has been concluded in para 20 thereof which is to the following effect:
'We have no evidence in this case of the circumstances existing at the date of the mortgage as to the pecuniary condition of the mortgagor or as to anything else from which we may come to the conclusion that the mortgagee had taken advantage of the difficulties of the mortgagor and imposed a hard bargain on him. It was said that the fact that the property was subject to a prior mortgage at the date of the mortgage in suit indicate the impecunious position of the mortgagor. We are unable to agree with, this contention. Every debtor is not necessarily impecunious. The mortgagor certainly derived this advantage from that mortgage that he was able to free from the earlier mortgage the Kacheri and he has been our mind, indicates, that the bargain had been freely made. There was nothing else to which our attention was directed as showing that the bargain was hard. We, therefore, think that the bargain was a reasonable one and the eighty-five years' term of the mortgage should be enforced. We the come to the conclusion that the suit was premature and must fail.'
8. On the other hand, the learned counsel for the plaintiffs-respondents mainly relied upon paras 11 and 18 thereof. From the said judgment, it is evidence that 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 money on the mortgage. As observed earlier, this is not the case pleaded by the plaintiffs in their plaint and even the lower Appellate Court has found that the plaintiffs have not relied upon the use of undue influence or the fraud and they are only challenging the mortgage on the ground that the terms in the mortgage deed was unconscionable. Rather the evidence on the record is to the contrary particularly when Smt. Swaran Kaur appeared in the witness-box as DW 2. As a matter of fact, for all intents and purposes, it was virtually a sale though it was termed to be a mortgage and the mortgagor. Smt. Swaran Kaur on that account was allowed to redeem after a period of 90 years. There is nothing on the record to prove that the market price of the suit land in the year 1962 when it was mortgaged for a sum of Rs. 7,000/- , was more than that. The plaintiffs themselves purchased the equity of redemption in the year 1966, i. e. after more than four years of the mortgage for a sum of Rs. 8,000/- . Thus it is quite evident that virtually Smt. Swaran Kaur had sold the suit land in favour of the mortgagee by executing the mortgage deed Exhibit P-1. If once it is so held then the question of clog on the equity of redemption as such does not arise. The rule against clog 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 or be limited by any contract between the parties. The Courts will ignore any contract the effect of which is to deprive the mortgagor or his right to redeem the mortgage. Smt. Swaran Kaur never complained of it and she voluntarily executed the mortgage deed Exhibit P-1 fully knowing the terms and conditions mentioned therein.
The plaintiffs while purchasing the equity of redemption were fully aware of those conditions. In spite of this, they purchased the equity of redemption on payment of Rs. 1,000/- as a sum of Rupees 7,000/- was left with them for payment to the mortgagees at the time of redemption. Thus on the facts and circumstances of the present case, it could not be held that the mortgage was obtained by taking advantage of any difficulty or embarrassment when she had borrowed the money on the mortgage as held by the Supreme Court in Ganga Dhar's case (supra). The mere terms of the mortgage deed could not be held to be unconscionable unless there was any allegation that the same were entered into under some undue influence or otherwise.
9. Reference was also made to S. 59A of the Transfer of Property Act (hereinafter called the Act), which provides that,--
'Unless otherwise expressly provided, reference in this Chapter to mortgagors and mortgagees shall be deemed to include reference to persons deriving title from their respectively.'
Thus the plaintiffs are bound by the terms and conditions in the mortgage deed in the same manner as Smt. Swaran Kaur, the original mortgagor was bound by them.
10. As regards the planting of trees etc. on the land mortgaged, reference was made to S. 63A of the wherein it has been provided that if mortgaged property in possession of the mortgagee has, during the continuance of the mortgage, been improved, the mortgagor upon redemption, shall, in absence of a contract to the contrary, be entitled to the improvement; and the mortgagor shall not, save only in cases provided for in sub-section (2), be liable to pay the cost thereof. Thus, it was argued on behalf of the appellants that the condition of planting trees and realising their price at the time of redemption was in accordance with the provisions of S. 63A of the Act.
11. An argument was also raised on behalf of the appellants that it was not a usufructuary mortgage as such, but was an anomalous mortgage as defined in S. 58(g) of the Act and, therefore, there was nothing wrong or illegal in the condition that the mortgagees could recover their mortgage money as and when they liked. However, I do not find any merit in this contention which has otherwise also not much bearing on the merits of the case. For all intents and purposes, however, it was a usufructuary mortgage.
12. The learned counsel for the respondents also relied upon Murarilal v. Devkaran AIR 1965 SC 225 to contend that the very stipulation that the mortgage shall be redeemed after 90 years amounted to a clog on equity of redemption. However, I do not find any force in this contention. Nowhere it has been so laid down in the judgment referred to above. In that case the mortgage deed provided that if the mortgage is not redeemed within 15 years, the shops would be deemed as an absolute transfer which was held to be a clog on the equity of redemption. Thus, this case has no applicability to the facts of the present case.
13. Thus replying on the judgment of the Supreme Court in Ganga Dhar's case (AIR 1958 SC 770)(supra) coupled with the fact that the mortgage amount was virtually the market price of the land, I am of the considered opinion that the terms as such could not be held to be unconscionable without there being any allegation of undue influence or fraud etc. The findings of the trial Court in this behalf were correct, but the lower Appellate Court reversed the same illegally.
14. Consequently, the appeal succeeds, the judgment and decree of the lower Appellate Court are set aside and those of the trial Court dismissing the plaintiffs' suit are recorded with no order as to costs.
15. Appeal allowed.