J.C. Shah, J. - (1.) THIS is an appeal against the decree of the High Court of Judicature at Nagpur in Civil Appeal No. 10 of 1954 reversing the decree passed by the Second Additional District Judge, Amravati in Civil Appeal No. 5A of 1954. The High Court has by its decree directed the Court of first instance to pass a decree for redemption.
(2.) THE appeal raises a question as to the true effect of a deed dated September 10, 1931, executed by Shri Narayan Rambilas Agarwal and his two sons Sadan Gopal and Murli Dhar in favour of two brothers Bhaskar Waman Joshi and Trimbak Waman Joshi. The deed ostensibly conveys an absolute title to certain properties described therein. The transferors under the deed contend that the property transferred by the deed was intended to be mortgaged under a deed of conditional sale. The transferees contend that by the deed an absolute conveyance of the property thereby conveyed was intended and that the conveyance was subject to a condition of repurchase to be exercised within a period of five years from the dale of the deed. The Court of first instance dismissed the suit holding that the transaction in the deed dated September 10, 1931, was of the nature of an absolute conveyance with a condition of repurchase and the period limited by the deed for reconveyance had expired long before the date of the suit. The High Court held that the transaction was a mortgage by conditional sale and on that view reversed the decree and directed that a redemption decree be passed. The properties in dispute are three in number: (1) a house in Amravati outside the Amba Gate bearing Municipal No. 5/98. (2) A Chawl in Amravati bearing old Municipal Nos. 6/857, 6/853 and 6/859, and (3) a house situated in Dhanraj Lane Amravati bearing old Municipal No. 3/459. By the deed the properties were separately valued. The house at Amba Gate was valued at Rs. 11,500/ - the Chawl was valued at Rs. 26,000/ - and the house at Dhanraj Lane was valued at Rs. 2,000/ -. At the date of this transaction, the transferors were indebted to the Imperial Bank of India in the sum of Rs. 30,000/ - and Rs. 9,500/ - were due to the transferees and their relations and friends, and to satisfy this liability of Rs. 39,500/ - the deed was executed. Possession of the property transferred was delivered by calling upon the tenants in occupation to attorn to the transferees. The transferees constructed eight shops in the compound of the Amba Gate house in the year 1940 -1941 and made certain other constructions in the compounder the Chawl, and they sold the Dhanraj Lane house to one Suraj Mal Salig -Ram. On the August 26, 1943, the transferees served a notice upon Bhaskar Waman Joshi and the representatives -in -interest of Trimbak Waman Josni stating that they were willing to redeem the mortgage created by the deed dated September 10, 1931, and called upon the transferees "to render full, true and proper account" of the amount claimable under the deed. By their reply Bhaskar Waman Joshi and the representatives of Trimbak Waman Joshi denied that the transferees had any right to redeem the property conveyed by the deed and asserted that the claim "to treat the sale as a mortgage was an after -thought" in view of the abnormal rise in prices which had lately taken place. On September 9, 1943, the three transferors and other members of their joint Hindu family filed Suit No, 5 -A of 1943 in the Court of the Additional District Judge, Amravati against Bhaskar Waman Joshi and the representatives -in -interest of Trimbak Waman Joshi and Suraj Mal Salig Ram for a decree for redemption alleging that the transfer in -corporated in the deed dated September 10, 1931, was in the nature of a mortgage by conditional sale.
(3.) EXH . D -1 which is the deed in question recites that the transferees were indebted, that they needed Rs. 39,500/ - to discharge their liability, that Rs. 2,320/ - were due to the transferees and that amount was set off and the balance of Rs. 37,180/ - was paid by eight Cheques drawn on the Imperial hank of India. It was then recited that the immovable properties described in the deed were conveyed in full ownership and that possession was delivered to the transferees. The deed then proceeded to recite the conditions "in respect of this sale". If our heirs or ourselves demand reconveyance of one two or all the three houses of the above estate at any time within 5 (five) years of this date (this time limit shall be followed very strictly -it has been finally settled that we will lose this right if one more day expire), you or your heirs shall recovery to us at our expenses the respective houses for their respective prices mentioned in this deed of sale. With a view that both sides should have equal rights in respect of this condition, it has been agreed between us that if our heirs or ourselves do not exercise this right of reconveyance in respect of all the three houses or any one of them within four and a half years of this day and if for any reasons you or your heirs do not deem it proper to retain anyone or all these houses hereafter, you and your heirs have a right to take back from us or our heirs the amount of consideration of this deed of sale and to return all the three houses or any of them in the condition in which the same may be at that time and if you or your heirs express such a desire and if we or our heirs fail to comply with it, it shall be tantamount to our breaking the agreement of reconveyance and we and our heirs will be liable to pay damages. It has been (further) agreed between us that in the event of such a reconveyance, our heirs and ourselves will pay full prices (as mentioned in this deed of sale) of the estate in the condition in which it may be at that time, that is, in the condition in which it may be on account of heavenly mishap or Government action, on account of any reason whatsoever or on account of fall in prices,;