DHARMAJI SHANKAR SHINDE AND OTHERS versus RAJARAM SHRIPAD JOSHI (DEAD) THROUGH LRS. AND OTHERS

Citation: [2019] 6 S.C.R. 257 · Decided: 23-04-2019 · Supreme Court of India · Bench: R. BANUMATHI · Disposal: Appeal(s) allowed

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Judgment (excerpt)

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DHARMAJI SHANKAR SHINDE AND OTHERS
v.
RAJARAM SHRIPAD JOSHI (DEAD) THROUGH LRs. AND
OTHERS
(Civil Appeal No. 7448 of 2008)
APRIL 23, 2019
[R. BANUMATHI AND R. SUBHASH REDDY, JJ.]
Deeds and Documents – ‘Mortgage by conditional sale’ or
‘Sale with a condition to repurchase’ – Respondents-plaintiffs case
was that the suit property was mortgaged by their father in favour
of the predecessor-in-interest of the appellants-defendants for
Rs.2500/- – Pursuant thereto, a Deed (Ex.P-73) was executed by
the parties – According to the respondents the said deed was a
deed of ‘mortgage by conditional sale’ with a condition that if the
amount is not repaid within a period of five years from the date of
execution of the deed, then the same would be treated as an absolute
sale between the parties conferring absolute right of ownership on
predecessor-in-interest of the appellants-defendants and his legal
representatives – It was alleged that father of respondents failed to
repay the money within the stipulated period – After death of their
father, respondents-plaintiffs filed a suit for redemption of the
mortgage and contended that their father had paid Rs.800 (Ex. P-
69) – Appellant-defendant defended the suit on the basis that
transaction was a sale with condition to repurchase – Trial court
dismissed the suit holding that the relationship of debtor and creditor
was not established – First Appellate Court set aside the judgment
of the trial court and held that (Ex. P-73) was a ‘mortgage by
conditional sale’ – Aggrieved, appellants preferred second appeal
before the High Court which was dismissed – On appeal, held:
Whether the document is a ‘mortgage by conditional sale’ or ‘sale
with a condition to repurchase’ is to be ascertained from the intention
of the parties – It is trite law that the intention of the parties should
be gathered from the recitals of the document itself – In the instant
case, by perusal of Ex.P-73 it was clear that eight days prior to
Ex.P-73, father of respondents had borrowed orally a sum of
Rs.700/- – Later, when Ex.P-73 was executed, the earlier borrowed
   [2019] 6 S.C.R. 257
257
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SUPREME COURT REPORTS
[2019] 6 S.C.R.
amount of Rs.700 was adjusted from the sale consideration of
Rs.2500/-  – The intention of  the parties in putting an end to the
debtor-creditor relationship with respect to the sum of Rs.700/- was
clear from the recitals of the document i.e. adjustment of Rs.700/-
from the total consideration of Rs.2500/- and parties intended to
create a relationship of vendor and vendee by transfer of the suit
property for a consideration of Rs.2500/- – Further, period of five
years was fixed in Ex.P-73 within which father of respondents was
to repay the said amount – Thus, clauses in Ex.P-73 were consistent
with the intention of the parties that they made the transaction a
conditional sale with an option to repurchase – Having not paid
the amount within the stipulated period of five years, the plaintiffs
lost their right to repurchase – Insofar as Ex. P-69 is concerned, it
cannot be relied upon as corroborative piece of evidence to hold
that part payment was made by father of respondents and that parties
treated Ex.P-73 as ‘mortgage by conditional sale’ – Therefore, the
Judgment of the High Court is set aside – Judgment of the trial
court restored – Transfer of Property Act, 1882 – s.58(c).
Allowing the appeals, the Court
HELD: 1. By perusal of Ex.P-73, it is clear that eight days
prior to Ex.P-73, father of respondents-plaintiffs has borrowed
orally a sum of Rs.700/- for the purpose of marriage of his
daughter.  At the time of execution of Ex.P-73 (28.07.1967), father
of respondents-plaintiffs required more money for the same
reason and he executed Ex.P-73-document titled as “mortgage
by conditional sale” for a consideration of Rs.2500/- and on the
date of execution of the said document, father of respondents-
plaintiffs received only a sum of Rs.1800/-.  The earlier borrowed
amount of Rs.700/- was thus adjusted from the sale consideration
of Rs.2500/-.  The intention of the parties in putting an end to the
debtor-creditor relationship with respect to the sum of
Rs.700/- is clear from the recitals of the document i.e. adjustment
of Rs.700/- from the total consideration of Rs.2500/- and parties
intending to create a relationship of vendor and vendee by transfer
of the suit property for a consideration of Rs.2500/-. Period of
five years was fixed in Ex.P-73 within which 

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