Court rules that the limitation period for redemption starts when the mortgagor tenders payment, not from the mortgage execution date.
In a landmark judgment, the Allahabad High Court has ruled in favor of the mortgagors in the case of Shri. Ram Prakash v. Smt. Asha Johri, reaffirming the right of redemption in usufructuary mortgage cases. The court held that the limitation period for redeeming a mortgage does not commence from the date of the mortgage deed's execution but starts when the mortgagor tenders or pays the mortgage money or deposits the amount in court.
The case involved a house in Bareilly, mortgaged by Jagdish Prasad Johri in 1978 to secure a debt of Rs. 15,000. After his death, his heirs sought redemption of the mortgage by offering to repay the mortgage amount in 2015. However, the defendants argued that the limitation period had expired, as the mortgage was executed decades earlier.
Justice Manish Kumar Nigam, presiding over the case, rejected the defendants' plea, emphasizing the statutory right of redemption under Sections 60 and 62 of the Transfer of Property Act, 1882. The court clarified that the right to redeem continues until the mortgage money is paid from rents and profits or through tender by the mortgagor.
This decision aligns with previous Supreme Court rulings, particularly the case of Singh Ram v. Sheo Ram, which highlighted the continuing nature of the right to redemption in usufructuary mortgages. The court's interpretation ensures that mortgagors are not unduly deprived of their right to reclaim their property.
The judgment underscores the legal principle that "once a mortgage, always a mortgage," reinforcing the idea that mortgages remain redeemable until the debt is settled. This ruling not only provides clarity on the limitation period for mortgage redemption but also safeguards the rights of mortgagors across India.
Bottom line:-
Usufructuary Mortgages - In cases of usufructuary mortgage, where rents and profits are adjusted towards interest or principal, the limitation period for redemption starts only when the mortgagor tenders payment to the mortgagee or deposits the mortgage amount in court, as per section 62 of the Transfer of Property Act.
Statutory provision(s): Section 60, Section 62 of the Transfer of Property Act, 1882; Article 61(a) of the Limitation Act, 1963
Shri. Ram Prakash v. Smt. Asha Johri, (Allahabad) : Law Finder Doc id # 2934363
