Shri Ram Prakash and 3 Others v. Smt. Asha Johri and 3 Others, 2026

The mortgage secured a debt of ₹15,000. Possession of the property was handed over to the mortgagees, and the rent from the property was to be adjusted towards interest. The mortgage deed mentioned a four-year period.

After Jagdish Prasad Johri died on 26 October 2015, his heirs sought redemption of the mortgage. On 30 December 2015, they tendered ₹15,000 through a bank pay order and issued notice requesting cancellation of the mortgage and restoration of possession.

The mortgagees refused the tender and contended that the suit was barred by limitation because the mortgage had been executed in 1978 and the 30-year limitation period had allegedly expired in 2012.

The trial court rejected the application under Order VII Rule 11 CPC, holding that the suit was not barred by limitation. The revisional court also dismissed the challenge. The mortgagees therefore approached the High Court under Article 227.

Justice Manish Kumar Nigam examined the nature of a usufructuary mortgage under Section 58(d) of the Transfer of Property Act and the special right of redemption/recovery of possession under Section 62.

The Court relied substantially on the Supreme Court's Larger Bench decision in Singh Ram (D) through LRs v. Sheo Ram, which held that, in a usufructuary mortgage covered by Section 62, the right to recover possession continues until the mortgage money is paid out of rents and profits or the balance is paid/tendered or deposited by the mortgagor. Consequently, limitation under Article 61 does not begin merely from the date of execution of the mortgage.

The Court also noted that the Supreme Court's later decision in Harminder Singh (D) through LRs v. Surjit Kaur (D) through LRs reaffirmed the principle in Singh Ram.

Under Section 58(d), possession is delivered to the mortgagee, who is entitled to retain possession and appropriate the rents and profits towards interest or mortgage money. The mortgagee therefore remains in possession while the mortgage subsists.

The Court emphasized that Section 62 is a special provision dealing specifically with the rights of a usufructuary mortgagor. Where rents and profits are adjusted towards interest and the principal remains payable, the mortgagor's right to recover possession arises upon payment or tender of the mortgage money/balance.

The Court preferred the rule established in Singh Ram v. Sheo Ram over the earlier reasoning in Prabhakaran v. M. Azhagiri Pillai and Sampuran Singh v. Niranjan Kaur. The Supreme Court in Singh Ram specifically held that the special right of a usufructuary mortgagor under Section 62 means that limitation does not start until the statutory conditions for recovery of possession are fulfilled.

The mortgage deed's four-year period did not mean that limitation began automatically upon expiry of those four years. The High Court observed that, at most, the clause could restrict the mortgagor from seeking redemption during that period; it did not make 28 March 1982 the starting point for limitation.

The decisive event was the 30 December 2015 tender of ₹15,000 through a pay order. Although the mortgagees refused to accept it, the tender constituted the relevant event for commencement of limitation. Since the suit followed on 3 March 2016, it was not time-barred.

The ruling reinforces the principle that “once a mortgage, always a mortgage” in the context of the continuing right of redemption, subject to lawful extinguishment under Section 60. It also confirms that the special statutory protection afforded to usufructuary mortgagors under Section 62 must be considered while determining limitation under Article 61(a).