How to ascertain whether a transaction is sale transaction or mortgage transaction?

The recitals "your amount shall carry no interest and my fields will not carry any rent" indicate that the consideration received by the transferor was to be treated as a debt. The interest was payable in the shape of appropriation by the transferee of the rent which he would otherwise be liable to pay to the transferor. That there has been an express mention of interest militates against any assumption that the transaction was intended to operate as an absolute sale. The stipulation that the transferee was to pay land revenue appears to be of no significance beyond the fact that the person who was to enjoy the profits was to bear the burden. Then the recital "I cease to have any right, etc., for five years" followed by the expression "I shall pay and shall redeem my fields" clearly goes to prove the existence of the relation of debtor and creditor between the parties. The vernacular words equivalent to the word "redeem" are "sodun ghein"  which mean 'release or redeem.' These are significant inasmuch as if there had been an intention to purchase back the fields, the words used would have been 'vikat ghein' .

10. In the premises, the impugned judgment and order of the lower Appellate Court does not disclose any error of law in the matter of construction of the document. The construction of a document is a mixed question of law and fact. As I have noted above, it is essentially to be decided by considering the words employed by the parties, though it is permissible to take into account surrounding circumstances in case the words used are not sufficiently clear to designate their effect. The words used in the present case are sufficiently clear and their effect is to create a mortgage by conditional sale with a right of redemption preserved unto the debtor. The relationship conveyed by the document is of debtor and creditor and not of vendor and buyer.

IN THE HIGH COURT OF BOMBAY

Second Appeal No. 369 of 2013 and Civil Application No. 1011 of 2013 in Second Appeal No. 369 of 2013

Decided On: 07.03.2017

Mangal Popatrao Sodmise Vs.  Abdagiri Vishvanath Narale

Hon'ble Judges/Coram:

S.C. Gupte, J.

Citation: 2017(6) MHLJ 152

Print Page

Whether construction of documents which are not documents of title becomes issue of law?

A Construction of documents (unless they are documents of title) produced by the parties to prove a question of fact does not involve an issue of law, unless it can be shown that the material evidence contained in them was misunderstood by the Court of fact. The documents in this case, which have been the subject of three separate considerations, were the Land Registers the Amarkam, and Bhooband Accounts and the Adangal Registers, together with certain documents derived from the Zamindari records. None of these documents can be correctly described as a document of title, whatever its evidentiary value otherwise. We do not, however, wish to rest our decision on this narrow ground even if right, because the legal inference from the proved facts may still raise a question of law.

Supreme Court of India

Nedunuri Kameswaramma vs Sampati Subba Rao on 17 April, 1962

Equivalent citations: 1963 AIR 884, 1963 SCR (2) 208

Bench: Hidayatullah, M.

Print Page