A mortgage deed
Supreme Court in Jayasingh Dnyanu Mhoprekar and Another Vs. Krishna Babaji Patil and Another, held:
It is well settled that the right of redemption under a mortgage deed can come to an end only in a manner known to law. Such extinguishment of the right can take place by a contract between the parties, by a merger or by a statutory provision which debars the mortgagor from redeeming the mortgage. A mortgagee who has entered into possession of the mortgaged property under a mortgage will have to give up possession of the property when a suit for redemption is filed unless he is able to show that the right of redemption has come to an end or that the suit is liable to be dismissed on some other valid ground. This flows from the legal principle which is applicable to all mortgages, namely “once a mortgage, always a mortgage.
Any provision incorporated in the mortgage deed to prevent or hamper the redemption would thus be void. A mortgage cannot be made irredeemable and the right of redemption not an illusory. This Court in Seth Ganga Dhar Vs. Shankar Lal and Others, held:
The rule against clogs on the equity of redemption is that, a mortgage shall always be redeemable and a mortgagor’s right to redeem shall neither be taken away nor be limited by any contract between the parties. The principle behind the rule was expressed by Lindley M.R. in Santley v. Wilde (1899) 2 Ch. 474 in these words:
The principle is this: a mortgage is a conveyance of land or an assignment of chattiest as a security for the payment of a debt or the discharge of some other obligation for which it is given. This is the idea of a mortgage; and the security is redeemable on the payment or discharge of such debt or obligation, any provision to the contrary notwithstanding. That, in my opinion is the law. Any provision inserted to prevent redemption on payment or performance of the debt or obligation for which the security was given is what is meant by a clog or fetter on the equity of redemption and is therefore void. It follows from this, that “once a mortgage, always a mortgage.
The right of redemption, therefore, cannot be taken away. The court will ignore any contract the effect of which is to deprive the mortgagor of his right to redeem the mortgage. One thing, therefore, is clear, namely, that the term in the mortgage contract, that on the failure of the mortgagor to redeem the mortgage within the specified period of six months the mortgagor will have no claim over the mortgaged property, and the mortgage deed will be deemed to be a deed of sale in favour of the mortgagee, cannot be sustained. It plainly takes away altogether, the mortgagor’s right to redeem the mortgage after the specified period. This is not permissible, for “once a mortgage, always a mortgage” and therefore always redeemable. The same result also follows from Section 60 of the Transfer of Property Act. So it was said in AIR 1922 17 (Privy Council) .
An anomalous mortgage enable a mortgagee after a lapse of time and in the absence of redemption to enter and take the rents in satisfaction of the interest would be perfectly valid if it did not also hinder an existing right to redeem. But it is this that the present mortgage undoubtedly purports to effect. It is expressly stated to be for five years, and after that period the principal money became payable. This, u/s 60 of the Transfer of Property Act, is the event on which the mortgagor had a right on payment of the mortgage money to redeem.
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