P L D 1971 Dacca 158 (PLP)

BAQUER, J.‑This appeal under clause 15 of the Letters Patent arises out of a suit for redemption with the alternative prayer for getting reconveyance of the case land. The case land appertained to Schedule Ka of the plaint and there is no dispute that the Ka Schedule land originally belonged to Muhammad Idris. The plaintiff‑appellants are heirs of Muhammad Idris. Plaintiffs' case is that Muhammad Idris gave the land in Kot Mortgage to defendant No. 7 Serajuddin Chowdhury by a deed dated 13th December 1914, for a sum of Rs.

700. Properties of Schedule Ka (1), Ka (2) and Ka (3) appertained to the Ka Schedule land. Muhammad Idris sold the land of Schedule Ka (1) to his wife Arfannessa by a kabala dated 8‑10‑1914. 7 he land of Schedule Ka (3) was transferred to Nawab Jan Bibi predecessor of defendants Nos. 20 to 22 by a kabala, dated 21‑12‑1915. Nawabjan redeemed the land of Schedule Ka (3). Muhammad Idris sold the land of Schedule Ka (2) by a kabala, dated 13‑10‑1918 to Abdul Huq. The heirs of Abdul Huq again sold the property to Arfannessa by a kabala, dated 3‑4‑1934. Plaintiffs instituted the suit for redemp tion of the remaining land described in Schedule Ga out of the land transferred by the deed dated 13‑12‑1914. Defence was that the document dated 13‑12‑1914, was neither a Kot Mortgage by conditional sale nor a kabala with the condition of repurchase but that it was a deed of out and out sale and that as such plaintiffs' suit for redemption or for reconveyance was not maintainable. It was also alleged that the defendants are bona fide purchasers for value without notice of the sale with a condition of repurchase. The learned Munsiff held that the document Exh. 3 (a) was an out and out sale deed and not a mortgage by conditional sale and that the covenant for repurchase was a personal cove nant not running with the land and that the covenant of repurchase being unlimited in point of time, offended the rule against perpetuity under section 14 of the Transfer of Property Act. He was also of the view that even if the document would be a deed of mortgage by conditional sale or a deed of sale with a condition of repurchase, the defendants who were bona fide purchasers for value without notice were entitled to protec tion under section 41 of the Transfer of Property Act. Accord ingly, the learned Munsiff dismissed the suit. On appeal the learned Subordinate Judge held that the document Exh. 3 (a) was not a Kot Kabala and that it was a sale with the condition of repurchase. He, however, held that as the covenant relating to reconveyance offended the rule against perpetuity, the plaintiffs who were the heirs of Muhammad Idris were not entitled to reconveyance. In that view of the matter, the appeal was dismissed by him. On second appeal by the plaintiff ‑appellants, the learned Single Judge dismissed the same affirming the judgment and decree passed by the first appellate Court. The learned Single Judge held that it was a sale with the condition of repurchase and that it was hit by section 14 of the Transfer of the Property Act and that the covenant for repurchase being personal the heirs of the transferor could not sue for reconveyance. He also held that claim for reconveyance of a portion of the land was barred under section 17 of the Specific Relief Act. Hence this letters patent appeal. Mr. Muzammel Huq, the learned Advocate appearing before us for the plaintiff‑appellants has urged that the case is one of mortgage by conditional sale and not sale with a condition of repurchase as held by the learned Single Judge. He has referred to the words, "Kot Kabala, Khalash" as appearing in the document Exh. 3 (a) and those words, according to him, are clear and decisive as to mortgage. The learned Advocate wants to say that those words being clear, the learned Single Judge was not justified in entering into the question of intention of the parties to come to the conclusion as he has done. It appears that at the top of the document Exh. 3 (a) there is mention of Kot Kabala although in the body of the document it has been described as "(Deed of sale free from circumstances)". It has also been stated in the document that the transferee would be entitled to mutate his name in the Sherista of the landlord and to enjoy the properties as his own with the right of inheritance and that he would be entitled to possess, settle, etc. In the last part of the document it has been stated that in case the transferor or his heirs repay the consideration money, the sold land would be released. Thereafter again it has been stated that the document was a kabala. The word "Khalash" also it seems is quite prominent in the document. By reason of the confusion created as a result of use of the expressions like "Khalash, Kabala, Kot Kabala, sold", it became essential to enter into the intention of the parties. So the contention that it was not necessary to enter into the intention of the parties has no substance. Mr. Muzammel Huq has next argued that conceding that the Court is entitled to enter into the intention of the parties the learned Single Judge in trying to determine the intention considered the seven tests which he set before himself too mechanically and mathematically without making any difference between the more important and less important test, The accepted seven tests as considered by the learned Sub ordinate Judge, are :‑ "(i) The existence of a debt ; (ii) the period of repayment short‑period being indicative of a sale and a long period of a mortgage ; (iii) possession of the property, the continuance of the grantor in possession indicating a mortgage; (iv) existence or otherwise of a stipulation for payment of interest or reconveyance, a stipulation for interest on repayment indicating a mortgage; (v) adequacy or inadequacy of the consideration inadequate price indicating a mortgage; (vi) presence or otherwise of the stipulation of reconveyance in the document itself, the stipulation of reconveyance embodied in the deed being prima facie an indication that the transaction is a mortgage, and (vii) purchase of stamps and payment of registration costs, the same if done by the transferee, being indicative of a sale." It may incidentally be mentioned here that this last feature No. vii, if purchase and payment was made by the transferor had been taken as indicative of a mortgage and not sale in the decision in Second Appeal No. 275 of 1950 disposed of on 22nd of February 1956, an unreported decision which has been relied upon by both the sides and also by the present learned Single Judge. We are inclined to take‑the view as taken by Hamoodur Rahman, J., in the above Second Appeal No. 275 8 of 1950, that this feature No. vii is indicative of mortgage. The present learned Single Judge has considered in seven tests in coming to his finding in the following way "In respect of test No. 1, in this case there is no evidence of existence of any debt. As to the test No. 2, no period is mentioned. As to test No. 3, it is admitted that the transferee was in possession. Relating to test No. 4, there is no stipu lation for payment of interest. As to test No. 5, the price was inadequate, but inadequacy of price alone cannot be said by itself to be conclusive on the question that the document created a mortgage by conditional sale. (See Mal Ahmad and others v. Maktar Ahmad and others in S. A. 275 of 1950 referred to by the learned Advocate for appellants). In the document there is the stipulation for reconveyance. The stamps were purchased by the transferor Muhammad Idris and registration costs were paid by him. Out of seven tests indicated above, three are in favour of the plaintiffs and four are in favour of the defendants. The four tests which are in favour of the defendants indicate a clear intention of the parties that the transfer created by this document of 1914 was not a mortgage by conditional sale but a sale with the condition of repurchase. The learned Subordinate Judge was right in his interpretation that the transaction created by the documents Exh. 3 (a) was a sale with the condition of repurchase". Examining those lines there seems to be some force in the, contention, that the approach of the tests by the learned Single Judge was rather mechanical as indicated by his observation: "Out of seven tests indicated above, three are in favour of the plaintiffs . . . . . . . ." The importance of the tests have to be considered and not the number of tests crossed by any particular party. Moreover, examining the above unreported decision namely S. A. No. 275 of 1950, it appears that what Hamoodur Rahman, J., observed therein on the inadequacy of price was not simply that inadequacy of price alone could not by itself be said to be conclusive on the question that the document created a mortgage by conditional sale. But the whole observation of which this is a part is as follows: "I may add here that it is not always necessary that all the above circumstances should cumulatively exist but at the same time the existence of only one of the above circum stances should be considered with caution, for instance, the inadequacy of price alone cannot be said by itself to be con clusive on the question that the document creates only a mort gage by conditional sale." What Hamoodur Rahman, J. said is that it is not always necessary that all the above circumstances should cumulatively exist. He has also said at the same time that the existence of only one of the above features should be considered with caution for instance, the inadequacy of price alone cannot be the decisive factor. The spirit seems to be that of examining the impor tance of the tests and not the mere quantity of tests. In the facts of that unreported case, inadequacy of price (as in the instant case) was regarded as a very decisive factor. There was, of course, the presence of other features like that stamp was purchased by the mortgagor (as here) the absence of any indem nity clause in the document to show that in the event of return not being made the sale would become a sale out and out as here), the presence of the recoveyance clause in the document itself (as here), the use of the specific work "Kot Kabala" in the margin of the document. In the instant case it is to be noted that the expression "Kot Kabala" occurs not in the margin as in that unreported case but actually in the very opening of the document. The document starts by stating "Kot Kabala". Having regard to those features of that case Hamoodur Rahman, J. concluded: "I have given my careful consideration to the document in question as also to the circumstances mentioned above and it seems to me that the lower appellate Court has rightly held that the true intention of the parties to be gathered in the present case after applying the principles indicated above is that the parties only intended to create a mortgage by condi tional sale and not an out and out sale with a condition for repurchase." It is to be noted also that in that case Hamoodur Rahman, J., did not come to any finding on the point of existence of debt. Actually the case proceeded on the basis that there was no debt. It will now be our endeavour to see more closely whether similar features are present in the case before us. Mr. Kamaluddin Hussain, the learned Advocate appearing for the respondents has contended that in that case Hamoodur Rahman, J., also accepted the position that time not being the essence of the contract for the right to redeem could be exercised indefinitely after a period of ten years. It is true that in the present case no time limit for repay ment has been given but silence on the point may be more conducive to holding in favour of long period indicating mortgage rather than short period indicating sale. Mr. Kamaluddin Hossain has next argued that the existence of debt was the sine qua non for mortgage. Recalling what has been stated previously, Hamoodur Rahman, J. did not find the circumstance of any debt in that case and still he held that it was a case of mortgage. There is also some force in the contention of Mr. Mozammel Huq that debt contemplated here does not mean previous debt to the world but debt between the parties and the moment the money G was taken from the other side by mortgaging the land a debt was created. He referred to the following lines in the deed Exh. 3(a) :‑ "Whenever I or any of my heirs do return or offer to return the consideration money as stated, you or your heirs are to accept the said money and redeem the demised lands and if you do not redeem I shall have the liberty to deposit the consideration money in Court and have the demised lands redeemed". It means in substance that in the event of the return of the money, the vendee or his heirs will have to return the land and in the event of their not doing so, the vendor himself will have the right to go to Court and recover it. Mr. Kamaluddin Hossain has argued that the expression "I shall have the right", limits the power to recover it to only the vendor. Reading the whole text together, we cannot but hold that the expression "(myself)", as occurring at the end means "ourselves". In the instant case before us we find that the following elements are in favour of the plaintiff‑appellants: (1) Inadequacy of price; (2) no time limit; (3) purchase of stamps and payment of registration costs by mortgagor; (4) stipulation of repurchase in the same document, and (5) user of the expression "Kot Kababla" in the very body of the document and not merely in the margin as in the other] case. There are again certain other additional features, namely, Exh. 5 series which it seems escaped the attention of the Courts below as also of the learned Single Judge. Those show that the transferor continued to pay rents. Then again Exh. 4 (b) Muktigatra‑executed by the trans feree shows that the document of 1914 Exh. 3 (a) was a Kot Kabala. In this deed Serajuddin stated that Muhammad Idrii gave Kot Mortgage of the land in his favour. It is true that the contesting defendants are not bound by the statement in these documents as they were not parties to it but this fact can be taken as a circumstance only in favour of the appellants. Mr. Kamaluddin Hossain being confronted with this position has submitted that once the Court takes the view that the present is a mortgage by conditional sale, he will not press any other objection. Considering all the features and circumstances as above, we, hold that the present is a case of mortgage by conditional sale. Sufficient to state that the suit is well within sixty years and further the protection under section 41 of the Transfer of Property Act cannot by any means be invoked having regard to the fact that in Exh. 16 (c) the document on which the present bona fide purchasers based their claim on ‑the basis of the statement therein that the seller got the land by sale, there is clear mention of the earlier registered deed Exh. 3 (a) putting upon the bona fide purchasers the burden of verifying the position from inspection of that document Exh. 3(a). It has been stated in this Exh. 16(c) which purports to be a document of sale that: "If you be obstructed in possessing the lands in khas or if your purchased right be clouded by reasons of deception or due to any defect in title of my vendor Muhammad Idris." The meaning in substance is that the purchaser, would not suffer by reason of deception of Muhammad Idris or airy defect in its title. Apart from the earlier document, namely, Exh. 3 (a) being a registered document, there is, clear reference to that docu ment and it was, therefore, all the more necessary for the 'buyers to inspect that document. Moreover, the integrity of the mortgage having been split up owing to redemption of a part of it, partial redemption of the, remaining part can be allowed. In the circumstances as above, the appeal succeeds and the judgment and decree of the learned Single Judge are set aside. There will, therefore, be a decree for redemption of the remaining land described in Schedule Ga out of the land transferred by the deed .Exh. 3(a) dated 13‑12‑1914. In the circumstances of the case there will be no order as to costs. MAHMUD HUSAIN, J.‑I agree. A. E. Appeal accepted.