PRIVY COUNCIL

                  Mt. Bakhtawar Begam

                  Vs.

                              Husaini Khanum and another
                  (Lords Shaw, CJ, Moulton and Mr. Ameer Ali JJ)

                  6.2.1914

                  JUDGMENT

Mr. Ameer Ali J.

1. The suit which has given, rise to these consolidated appeals from a decree and
judgment of the High Court of Allahabad was instituted by the plaintiff-respondent in
the Court of the Subordinate Judge of Cawnpore for the redemption of a mortgage
executed so long ago as the 6th of January, 1830. The suit was brought on the 6th of
January, 1899, and the only and vital question presented at the Bar for determination
in this is whether the claim is barred by the Statute of Limitation (Indian Act XV of
1877).

2. The plaintiff Husaini Khanum alleges that on the 6th of January, 1830, her father,
Aga Fateh Ali, in conjunction with another relative named Aman Ali, executed a
mortgage by way of conditional sale in respect of 12 villages lying within the district
of Cawnpore in favour of one Ata-ullah Khan, since deceased. The other plaintiffs are
persons who have acquired title from Husaini Khanum. The principle defendant in the
action was one Ali Hussain Khan, who was the representative of Ata-ullah. He died
since the decision by the High Court in the appeal from the decree of the Subordinate
Judge, and he is now represented by his widow, Bakhtawar Begam, the appellant. The
remaining defendants are assignees of interests created by the original mortgagee or
his representatives in the mortgaged premises.

3. The mortgage-deed is not forthcoming, but both the Courts in India have found that
the contract between the parties to the transaction is, for all material purposes,
substantially set forth in the proceeding of the Collector's Court, dated the 18th of
September, 1830, on an application for mutation of names in the Revenue Register.
4. The contract of mortgage by conditional sale is a form of security recognized
throughout India, and its incidents have been embodied in Section 58 of Act IV of
1882 (the Transfer of Property Act). The form it usually takes is for the mortgagor to
execute a deed of sale in respect of the mortgaged property in favour of the mortgagee,
who on his side executes an agreement covenanting that on the liquidation of the debt,
according to the terms of the contract, the sale would be cancelled, and he would
reconvey the property to the mortgagor. On the breach of the condition relating to
repayment the contract executes itself, and the transaction becomes one of absolute
sale.

5. The proceeding which contains the contract in this case is set out in full in the
judgment of the High Court. The only material part to which their Lordships need
refer is the clause relating to repayment, which runs as follows:-

        "On being asked, Sital Parshad, attorney of Atta-ullah Khan, stated that his
        client had executed and made over to Mirza Aman Ali and Fateb Ali an
        agreement to the effect that the sale would be cancelled on payment of the
        amount of consideration in nine years, and that, therefore, the sale was not an
        absolute but a conditional sale."
6. The period of limitation under the Indian Statute for suits for redemption or for
recovery of possession of mortgaged property is sixty years from the date of the
accrual of the right to redeem or to recover possession (Article 148, Schedule II, Act
XV of 1877). The Subordinate Judge was of opinion that limitation began to run from
the date of the contract, and accordingly held that the suit was barred. The High Court
of Allahabad on appeal have taken a different view. The learned Judges considered
inter alia that the right to redeem in respect of the seven villages which were in the
possession of the mortgagee's representatives accrued only on the expiration of the
period of nine years for which the contract was made, but that as regards the five
villages which had been transferred by the mortgagee to third parties the claim was
barred. They accordingly decreed the plaintiffs claim in respect of seven villages and
dismissed it with regard to the rest.

7. The defendants have appealed from the first part of the High Court decree, against
which there is a cross-appeal on the part of the plaintiffs.

8. The first question to determine is whether the plaintiffs' right to redeem is affected
by 60 years' limitation, for in that case her claim must fail in toto. The learned Judges
dealing with this point give expression to their opinion in the following passage in
their judgment:-

       "If the meaning of this contemporaneous agreement was that the mortgagors
       might redeem at any time within the period of nine years, the plaintiffs' claim is
       barred by limitation. If, on the other hand the intention of the parties was that
       the debt should remain outstanding for a period of nine years certain then the
       right to redeem only accrued at the expiration of that period. Ordinarily, a
       mortgagor cannot before the time limited for payment to the mortgagee expires,
       take proceedings to redeem. The reason for this is, that it was the agreement of
       the parties that the mortgage should, during the intervening time, remain as
       security for the money advanced, and therefore it is not competent for either
       party to disturb that relation."
9. And they refer to a number of cases in support of their conclusion. 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. But there is nothing in law to prevent the parties
from making a provision that the mortgagor may discharge the debt within the
specified period and take back the property. Such a provision is usually to the
advantage of the mortgagor. In the present case, had the matter depended only on the
construction of the contract as given in the proceeding of the Collector, much might be
said in support of the High Court's conclusions. The expression that "the sale would be
cancelled on payment of the consideration in nine years" is certainly ambiguous.

10. But here the plaintiffs' case is that the mortgagors were entitled to recover the
property within the period of nine years on the liquidation of the debt with the usufruct
of the property. In the second paragraph of the plaint the plaintiffs state as follows:-

       "The terms of the mortgage as agreed were that the mortgagee should remain in
       possession of the said mortgaged villages.. that the amount of profits, if any,
       which shall remain after paying the Government revenue, interest, and pay of
       the persons making the collections, would be owned by the mortgagors and
       applied in the payment of the principal, and that whenever the mortgage-money
       would be satisfied (out of the usufruct, or paid (by the mortgagors) before or
       after the stipulated time the mortgaged property should be redeemed."
11. And the fact is emphasized in paragraph 8, which is in these terms:-

       "The whole amount of the principal mortgage-money with interest mentioned in
       the mortgage deed was paid up at the end of the year 1245 Fasli according to
       the account which is annexed to this plaint and forms part of it. No portion of
       the mortgage-money, interest or any other demand is now due: on the other
       hand, there is a surplus amount due to the plaintiffs."
12. In their Lordships' judgment this is not a case of a wrong construction of a clause
or condition in the contract. It is a distinct allegation of fact on which the right to
recover possession is founded. But the matter does not rest there. The plaintiffs
produced with the plaint a statement of accounts in respect of the 12 villages based on
the settlement, records to show the amounts realized by the mortgagee from 1830 to
1897. In this document it is clearly stated that the whole debt was satisfied in 1245
Fasli. (4th September, 1837 - 4th September, 1838). From that time the balance of the
realizations by the mortgagee after deduction of the legitimate outgoings is treated by
the plaintiffs as sums retained by him without any right.

13. If the fact be, as the plaintiffs allege, that the mortgage-debt became satisfied
under the contract in 1838, the right to recover possession accrued then, and the suit is
clearly barred.

14. Their Lordships are, therefore, of opinion that the decree of the High Court partly
decreeing the plaintiffs' claim should be set aside, and the suit dismissed, which will
involve the dismissal also of the cross-appeal.

15. With regard to the costs, their Lordships think that Jamna Narain, who represents
the original assignee of the five villages in respect of which the plaintiffs' suit has
been dismissed by both the Courts in India, is entitled to the costs decreed in the Court
of the Subordinate Judge and in the High Court, and to the costs of these appeals to
His Majesty in Council. As regards the other parties, their Lordships think that the
plaintiffs should bear the costs decreed against them in the First Court, but that each of
the parties should bear their respective costs of these appeals and of the appeals to the
High Court, including the costs incurred in the proceedings on remand.

16. And their Lordships will humbly advise His Majesty accordingly.

17. Appeal allowed.

Cross-appeal dismissed.