Ganga Dhar v. Shankar Lal, AIR 1958 SC 770

SETH GANGA DHAR V. SHANKAR LAL & ORS

ISSUE:

Whether a term period in a mortgage instrument, so far as it precludes the right to redeem from accumulating for a time, a clog on the equity of redemption?

RULE:

The rule in contradiction of clogs on the equity of redemption exemplified in Section 60 of the Act authorises the Court not only to dismiss a mortgagor of a bargain whereby in some conditions his right to redeem the mortgage is absolutely taken away, but also where that particular right is constrained.

FACTS:

On April 12, 1939, Dhanurpmal transferred his rights under the mortgage to Motilal who also died later and whose property is now being represented by his sons; they are the respondents in this appeal.
The property of Purshottamdas, who is the original mortgagor, is now also represented by his son, the appellant. Requesting a short-term loan without a job or payday monetary advance is the simplest thing to do and so is being eligible for it. There are only two easy limitations on it, such as, that you must have never evaded a prior payday loan and that you must have adequate income.
On April 12, 1939, Dhanurpmal transferred his rights under the mortgage to Motilal who also died later and whose property is now being represented by his sons; they are the respondents in this appeal.
The property of Purshottamdas, who is the original mortgagor, is now also represented by his son, the appellant. Requesting a short-term loan without a job or payday monetary advance is the simplest thing to do and so is being eligible for it. There are only two easy limitations on it, such as, that you must have never evaded a prior payday loan and that you must have adequate income.
On January 2, 1947, the complainant filed the suit in the Court of the Sub-Judge, Ajmere, alongside the respondents. The suit was challenged by the sons of Motilal, the assignee of the mentioned mortgage, who are the respondents appearing in the case appeal, who shall be henceforth mentioned as the respondents.
They stated that the suit was hasty as under the contract of mortgage there was no right of release for eighty-five years after the said date of the mortgage, till August 1, 1984.

HELD:

The Supreme Court held that the term provided for a period of eighty-five years was not a clog on the equity of redemption, and the mere length of the period could not by itself lead to an inference that the bargain was in any way oppressive or unreasonable.
The term was enforceable in law and the suit for redemption, filed before the expiry of the period was-premature.
Held, further, that the term that on the failure of the mortgagor to redeem within the specified period of six months, he would lose his right to do so and the mortgage deed was to be deemed to be a deed of sale in favour of the mortgagee, was clearly a clog on the equity of redemption and as such invalid but its invalidity could not in any way affect the validity of the other term as to the period of the mortgage, that stood clearly apart.