This petition under Article 227 of the Constitution arose from a civil suit instituted in 2016 for the redemption of a usufructuary mortgage originally executed in March 1978 for a principal amount of INR 15,000, wherein the mortgagee was put in possession and rents were adjusted towards interest. The petitioners (mortgagees) challenged concurrent orders of the trial court and revisional court rejecting their application under Order VII Rule 11 C.P.C. for dismissal of the plaint on the ground of limitation, arguing that the 30-year limitation period had expired in 2012 (30 years from the 4-year term ending in 1982). Dismissing the writ petition, the Allahabad High Court held that in a usufructuary mortgage where rents adjust against interest, the right to seek redemption and recover possession does not accrue on the date of the mortgage or upon the expiry of a fixed term, but only when the mortgagor tenders the principal amount or makes a payment/deposit under Section 62 of the Transfer of Property Act, 1882. Consequently, since the tender was made on December 30, 2015, the suit filed in 2016 was well within limitation.
- Nature of the Transaction:
- The mortgage deed dated March 28, 1978, executed by late Jagdish Prasad Johri in favour of the petitioners for INR 15,000, was categorized as a usufructuary mortgage under Section 58(d) of the Transfer of Property Act, 1882.
- The terms stipulated that possession was handed over to the mortgagees and the rent of the house was to be adjusted towards interest on the sum advanced.
- Statutory Framework and Limitation:
- Under Article 61(a) of the Limitation Act, 1963, the limitation period for a suit by a mortgagor to redeem or recover possession of immovable property is 30 years, starting from when the right to redeem or recover possession accrues.
- Section 62 of the Transfer of Property Act establishes that a usufructuary mortgagor has the right to recover possession when the mortgage money is paid out of rents and profits, or when the term has expired and the mortgagor pays, tenders, or deposits the balance.
- Rejection of Mortgagees’ Time-Bar Argument:
- The petitioners argued that the limitation period began after the expiry of the 4-year term on March 28, 1982, expiring on March 28, 2012, thereby extinguishing the right to seek possession under Section 27 of the Limitation Act.
- The High Court rejected this contention, affirming that in usufructuary mortgages where usufructs adjust against interest, limitation does not run from the date of execution or expiry of a term, but from the date when the mortgage money is tendered or paid.
- Judicial Precedents and Principles Applied:
- The Court relied upon the binding Supreme Court Constitution Bench ruling in Singh Ram v. Sheo Ram, which held that the special right of a usufructuary mortgagor under Section 62 of the T.P. Act commences when the mortgage money is paid or deposited, and until then, limitation under Article 61 does not start.
- The Court reaffirmed the timeless equity maxim: “Once a mortgage, always a mortgage,” emphasizing that the statutory right of redemption cannot be fettered or extinguished by the mere efflux of time unless done via a proper decree or act of parties under the proviso to Section 60.
- Final Decision:
- The trial court and revisional court committed no error in dismissing the application under Order VII Rule 11 C.P.C., as the cause of action validly arose on December 30, 2015, when notice and pay orders for the principal sum were tendered to the mortgagees and refused.
The writ petition was dismissed, and interim orders were discharged.
J.O. (Web) 2026 ALL 27
Shri Ram Prakash and 3 others v. Smt. Asha Johri and 3 others (D.O.J. 01.07.2026)
J.O. (Web) 2026 ALL 27 click here to view full text of judgment
