ASSIGNMENT

VALIDITY OF CLOG ON REDEMPTION

SUBMITTED TO- Dr NUTAN KANWAR

TEACHING ASSOCIATE, H.P. NATIONAL LAW UNIVERSITY

SUBMITTED BY-

SAUMYA RAJPAL

3RD YEAR BBA LLB

1120212262
 TABLE OF CONTENT

ACKNOWLEDGMENT..........................................................................................................3

DECLARATION......................................................................................................................4

INTRODUCTION....................................................................................................................5

CLOG ON REDEMPTION IN INDIA..................................................................................6

VALIDITY OF CLOG ON REDEMPTION..........................................................................8

1. Long Term Mortgages........................................................................................................8

2. Condition of Sale of Property...........................................................................................10

3. Penalty in case of default..................................................................................................11

4. Collateral Benefit to Mortgagor.......................................................................................12

5. Subsequent Agreement to postpone redemption..............................................................13

CONCLUSION.......................................................................................................................15
 ACKNOWLEDGMENT

The completion of the assignment required the assistance and guidance of many people and I
fortunately received them in abundance. Mere words will fall short to extend my thankfulness
to those without which the fruition of the project would not have been possible, their
dedication, sincerity, trust and helping me by providing all necessary information and advice
were essential for the completion of the project and I would thank them for their guidance
and assistance all along.

I, Saumya Rajpal would firstly like to thank my university, Himachal Pradesh National Law
University for endowing their trust and faith in me by giving me the opportunity of doing
such an interesting project and providing all necessary help and guidelines.

I would also like to extend my thanks to my project guide and mentor Dr Nutan Kanwar who
helped me by giving valuable insights into the problem and helping me with all necessary
information and guiding me through the project.

Also, I would like to thank my family and friends for their kind support and patience.
 DECLARATION

I, Saumya Rajpal solemnly declare that the project report is solely based on my own work
carried out with due care and diligence during the course of study under the supervision of Dr
Nutan Kanwar. I truly assert that the statements made and the conclusions drawn are hereby
an outcome of my research work. I further certify that-

I. The work contained in the report is original and has been done by me under the
general supervision of my professor.
II. The work has not been submitted to any other Institution for any
degree/diploma/certificate in this university or any other University of India or
abroad.
III. The guidelines provided by the university were followed in writing the report.
IV. Whenever any material was used like data, theoretical analysis, text or other
materials from other sources, due credit has been to the same in the text along with
furnishing their details for further references.
 INTRODUCTION

The term mortgage plays a vital role in understanding the property law. A mortgage is the
transfer of an interest vested in real estate in order to advance a loan or for any purpose that
could eventually result in the acquisition of a financial interest. The term "mortgagor" refers
to the one who transfers the interest, and "mortgagee" refers to the recipient of the transfer.
The principal money or amount is the sum for which the property is mortgaged. The Transfer
of Property Act of 1882 defines many mortgage kinds and their associated terms.

Upon the mortgage of the property, some rights of the mortgagor are automatically reserved.
The right to redemption is one of these crucial rights. According to Section 60 of the TPA,
every person who mortgages his property has a right to redeem whenever he clears off the
debts1. It follows from this that ‘once a mortgage, always a mortgage.’ 2 So, the mortgaged
property always remains as a mortgage, and the mortgagor has the right to redeem the
property after the completion of payment or after clearing the debts. This right to the
mortgagor is known as the “Equitable right to redeem.”

Section 60 of the Transfer of Property Act, 1882 provides the right of redemption to the
mortgagee. This right becomes alive only after the principal money becomes 3. There are
certain limitations to this right by the fact that it exists only till the mortgagee decides to
exercise his right of foreclosure on the property. Thus, the contract of mortgage between the
parties ends, when the debtor exercises his right to redeem through paying off the loan4.

1
Section 60 of TPA,1882
2
Santley v. Wilde (1899) 2 Ch. 474
3
Sarojini Prabhu v. Papikutty Adiesian, AIR 2007 Ker 44.
4
Parmeswaran Govindan v. Krishnan Bhaskaran, AIR 1992 SC 1135.
 CLOG ON REDEMPTION IN INDIA

In Stanley v. Wilde5, Lindley M.R. gave one of the founding explanations of the basis of this
doctrine –

“The principle is this: a mortgage is a conveyance of land or an assignment of chattels as a

security for the payment of a debt or the discharge of some other obligation for which it is
given. This is the idea of a mortgage: and the security is redeemable on the payment or
discharge of such debt or obligation, any provision to the contrary notwithstanding. That, in
my opinion, is the law. Any provision inserted to prevent redemption on payment or
performance of the debt or obligation for which the security was given is what is meant by a
clog or fetter on the equity of redemption and is therefore void. It follows from this, that
‘once a mortgage always a mortgage’.”

The maxim ‘once a mortgage always a mortgage’ means that there can no covenant that
modifies the character of the mortgage agreed between the parties that would stop the
mortgagor to redeem his property back on payment of the principal and respective interests6.

The basis of this doctrine lies in the exercise equity, justice and good conscience 7 and is
extensive to areas where the act is not applicable 8. On a realistic perusal of the workings of a
mortgage, it is observed in most of the cases that the mortgagor enters into such an agreement
because of some financial predicament. The law recognizes the power of the dominant party
to insert clauses which will serve his personal interests by creating impediments on the right
to redeem the property9. Such obstructions are henceforth struck down by the courts to enable
the mortgagee to redeem his property. In U. Nilan v. Kannayyan (Dead) Through Lrs.10,
explaining the philosophy behind the doctrine, it was said that –

“Adversity of a person is not a boon for others. If a person in stringent financial conditions
had taken the loan and placed his properties as security therefor, the situation cannot be
exploited by the person who had advanced the loan. The Court seeks to protect the person

5
(1899) 2 Ch 474
6
G.C.V. Subha Rao, Law of Transfer of Property Act 882 (4th ed., 2006).
7
Murarilal v. Dev Karan, AIR 1965 SC 225.
8
Ambalal Jasraj v. Ambalal Badarwal, AIR 1957 Raj 321.
9
Poonam Pradhan Saxena, Property Law 348 (2nd ed., 2011).
10
AIR 1999 SC 3750.
affected by adverse circumstances from being a victim of exploitation. It is this philosophy
which is followed by the Court in allowing that person to redeem his properties by making
the deposit under Order 34 Rule 5 C.P.C.”

In the legal matter of Bhullan v. Bachcha11, the mortgagor and mortgagee entered into an
agreement specifying that the property could only be redeemed upon the completion of 59
years and solely on a designated day in the 60th year. Failure to redeem the property on the
specified day in the 60th year would render redemption impossible. The plaintiffs, who were
the sons of the original mortgagors, filed an appeal in court 29 years later. They contended
that the stipulation unreasonably constrained the exercise of the right of redemption,
essentially rendering it null and void. The defense argued that the legal action was premature.
The court determined that the condition mandating redemption after 59 years in the context of
a usufructuary mortgage, wherein the mortgagee also enjoys income from the property,
constituted a restraint on redemption, and in this case, the 59-year timeframe was deemed
such a restraint. Thus, time was considered one of the impediments or "clogs" on the right of
redemption.

In the case of Kanaram v. Kuttooly12, the court concluded that if payments or debts were not
settled within the stipulated period, the mortgagee lacks the authority to sell the mortgaged
property. Any provision granting the mortgagee the power to sell under such circumstances is
deemed unlawful. Consequently, the appellants were successful in reclaiming their property.
However, questions arise concerning the legitimacy of the Doctrine in this context. Despite
both the mortgagor and mortgagee consenting to such conditions in the agreement, the
Doctrine asserts the nullity of such agreed-upon conditions. The apparent paradox arises from
the fact that even if the mortgagor willingly accepts such terms in the contract, this legal
principle renders such agreements void.

This raises scepticism about the rationale behind the Doctrine, considering that it operates
irrespective of the mortgagor's agreement to the specified conditions. However, the Doctrine
serves a crucial purpose by preventing mortgagees from potentially exploiting the terms
outlined in the mortgage deed. Without the Doctrine, mortgagees could exploit various
provisions to the detriment of mortgagors. The Doctrine of Clog on Redemption serves as a
safeguard, aiming to protect mortgagors from potential abuses by mortgagees. In cases

11
Bhullan v. Bachcha, AIR 1931 All 380.
12
AIR 1945 All. 380.
involving such issues, courts or relevant authorities must meticulously examine the intentions
of both the mortgagee and the mortgagor.

In the case of Gangadhar v. Sankar Lal13, a condition was established stipulating that the
mortgagors could only redeem their property after the lapse of 85 years. The mortgagors
contended that this 85-year timeframe constituted an impediment to redemption and sought a
court declaration of its invalidity. Conversely, the mortgagees argued that the legal action was
prematurely filed and urged the court to dismiss the appeal.

Ultimately, the court determined that the right to redemption had not been eliminated but
merely restricted for a specific duration. In this instance, the Doctrine of Clog on Redemption
was deemed inapplicable because the mortgagor had willingly agreed to the 85-year period
without any external pressure from the mortgagee. The court held that the mortgagor, having
entered into the contract with a sound mind and without coercion, could not claim the
doctrine's protection. Consequently, the appeal was dismissed.

CASES WHERE CLOG ON REDEMPTION IS INVALID

The determination of what constitutes a clog on redemption lacks fixed qualifying

circumstances, as outlined in legal precedent14. This issue necessitates a case-by-case
assessment based on the specific facts and circumstances 15. In other words, there is no
universally applicable set of conditions; rather, each situation must be individually evaluated
to ascertain whether a clog on redemption is present. There are certain situations where it was
held that the covenant was a clog on the right.

1. Long Term Mortgages

In the context of usufructuary mortgages, long-term mortgages, such as those spanning 95 or

100 years, may initially appear to be potential clogs on redemption. However, the Supreme
Court has clarified that the mere length of the term is not sufficient to label it as a clog.
Instead, the presence of undue advantage or fraud must be established to characterize it as
such16.

13
AIR 2000 SC 770.
14
Bhullan v. Bachcha, AIR 1931 All 380.
15
Pomal Kanji Govindji v. Vrajilal Karsandas Purohit, AIR 1989 SC 436.
16
Valdas and Ors. v. Bai Jivi and Ors, AIR 1973 Guj 93. Saleh Raj v. Chandan Mal, AIR 1960 Raj 47.
Long-term mortgages, especially prevalent in usufructuary mortgages with extended
durations such as 95 or 100 years, may raise concerns regarding the validity of clogs on
redemption in India. While the duration alone might suggest the possibility of a clog, Indian
legal precedent has clarified that the mere length of the mortgage term is not sufficient to
deem it as such.

The Supreme Court of India has established that for a mortgage to be considered a clog on
redemption, there must be a presence of undue advantage or fraud. Simply having a lengthy
term does not automatically render the mortgage invalid. This legal standpoint recognizes the
potential practicality of long-term mortgages, particularly in cases where extensive periods
are intrinsic to the nature of the transaction, such as usufructuary mortgages.

However, specific cases have highlighted that certain conditions within long-term mortgages
can indeed amount to clogs on redemption. For instance, if the terms of the mortgage
unreasonably restrict the mortgagor's ability to redeem the property, such as exorbitant
construction costs or an impractical repayment timeline, the courts may intervene and declare
those specific conditions as clogs on redemption. In summary, the validity of clogs on
redemption in the context of long-term mortgages in India hinges on a case-by-case analysis,
considering factors beyond the mere duration of the mortgage. The presence of undue
advantage, fraud, or oppressive conditions is crucial in determining the legality and
enforceability of such mortgages.

In the case of Vadilal Chhaganlal v. Gokaldas Mansukh17, a mortgage agreement stipulated a

duration of 99 years, allowing the mortgagee unrestricted construction rights without cost
limitations. The Supreme Court reasoned that the mortgagor would be unable to repay the
principal, interest, and construction expenses. Consequently, both conditions were deemed to
constitute a clog on the mortgagee's right of redemption.

In Ramkhilawan Dilrakhan Ahwashi v. Mullo18, the plaintiff argued that a covenant requiring
payment of the principal after 80 years and only in the month of Baisakh amounted to a clog.
Although the Trial Court and the High Court initially dismissed the suit, a different outcome
was reached in Balbhaddar Prasad v. Dhanpat Dayal19. In this case, a property mortgaged for
50 years valued at ₹9000 ultimately resulted in a redemption amount of around two and a
17
AIR 1953 Bom 408.
18
AIR 1957 MP 200.
19
AIR 1924 Oudh 193.
half lakhs after deducting profits. The court held that such an exorbitant sum rendered the
property irredeemable, deeming the contractual terms oppressive and unconscionable.

2. Condition of Sale of Property

In the legal landscape of mortgages in India, the condition of the sale of property is closely
tied to the validity of clogs on redemption. A clog on redemption refers to any provision or
condition in a mortgage agreement that unjustly restricts or hinders the mortgagor's right to
redeem the property. The validity of conditions of sale in the context of clogs on redemption
is an essential consideration in ensuring fairness and equity in mortgage transactions. The
Indian judiciary, in several landmark cases, has emphasized the need for careful scrutiny of
conditions related to the sale of mortgaged property. The principle established is that while a
mortgagee is entitled to protect their interest, any condition that unreasonably obstructs the
mortgagor's ability to redeem the property may be deemed invalid.

While assessing the condition of sale of property in the context of clogs on redemption, the
courts consider whether the terms are reasonable and fair. Conditions that unduly restrict the
mortgagor's right to sell the property, especially in long-term mortgages, may be subject to
legal challenge. A stipulation within a mortgage agreement indicating that the failure to
redeem a mortgaged property within a specified timeframe would result in its automatic sale
is deemed a clog20. However, if a distinct agreement exists, wherein the mortgagor
independently executes a sale deed in favor of the mortgagee, treated as a separate
transaction, such a sale deed is considered legally valid21.

In the legal case of Meharban Khan v. Makhna22, the mortgage agreement specified that the
mortgagee would possess the property for a duration of 19 years. It further outlined that if the
mortgagor settled the debt, redemption would be permitted only for a limited interest, with
the residual interest reverting to the mortgagor. Additionally, in the event of the mortgagor's
failure to fulfill the payment, the property would be deemed permanently sold to the
mortgagee. The court ruled that both conditions constituted clogs on redemption. It held that
upon the complete settlement of the outstanding amount, the property would revert without
any encumbrance. This legal principle is applicable to situations where, upon default in

20
Rocky Flora v. Parvarthy Ammal, AIR 1957 Ker 175. Hajee Fatma Bee v. Prohlad Singh, AIR 1985 MP 1.
21
Poonam Pradhan Saxena, Property Law 359 (2nd ed., 2011).
22
AIR 1930 PC 142.
payment, the property is considered foreclosed, which also qualifies as a clog 23. Nonetheless,
parties retain the freedom to introduce such conditions subsequent to the initial mortgage
agreement.

In the case of Kuddi Lal v. Aisha Jehan Begam24, the plaintiff-mortgagor sought redemption
by making payments directly rather than transferring the property. The court determined that
such a covenant amounted to a clog on redemption, as it restricted the mortgagor's ability to
alienate the property.

In summary, the validity of conditions of sale of property is intricately linked to the broader
issue of clogs on redemption in India. The courts play a crucial role in ensuring that mortgage
agreements strike a fair balance between the interests of both parties, preventing the
imposition of conditions that unreasonably impede the mortgagor's ability to redeem or sell
the property. Legal precedents continue to shape the evolving standards for evaluating the
validity of conditions in mortgage agreements in the Indian legal system.

3. Penalty in case of default

The imposition of a penalty in the event of default by the mortgagor may be considered
reasonable in some circumstances; however, there are situations where it could be deemed
unreasonable and penal. It is noteworthy that the mere presence of a high interest rate does
not automatically classify the condition as a clog on redemption, unless it can be
demonstrated that there was undue influence in the transaction 25. The reasonableness of such
penalties in mortgage agreements is subject to legal scrutiny, and the courts evaluate the
circumstances to determine whether the penalties imposed are fair and equitable or unduly
burdensome on the mortgagor. Instances where a penalty has been deemed unreasonable
include:

1. Imposing compound interest in the event of default, especially when the original interest
rate was already excessively high26.

2. Applying an increased rate of interest from the time the agreement is made upon default 27.

23
Shankar Dhonddev v. Yeshwant Raghunath, AIR 1928 Bom 82.
24
AIR 1927 Oudh 199.
25
Sarfarz Singh v. Udwat Singh, AIR 1929 Oudh 30.
26
Rama Krishnayya v. Venkata Somayajulu, AIR 1934 Mad 31.
27
Sunday Koer v. Sham Krishnen, ILR 34 Cal 150.
The validity of penalties imposed in the event of default is a critical aspect in the examination
of clogs on redemption within the legal framework of mortgages in India. While the
imposition of penalties for default by the mortgagor can be considered reasonable under
certain circumstances, it may be deemed invalid and constitutive of a clog in specific
situations.

It is essential to note that the mere presence of a high interest rate, by itself, does not
automatically render the condition a clog on redemption. The crucial determinant is whether
there is evidence of undue influence in the transaction. Courts carefully evaluate the
reasonableness of penalties in mortgage agreements, considering factors such as fairness and
equity. Unduly burdensome penalties that significantly impede the mortgagor's ability to
redeem the property may be subject to legal challenge.

In summary, the validity of penalties in the context of defaults and their impact on clogs on
redemption in India hinges on a case-by-case analysis. Courts play a pivotal role in assessing
the reasonableness of such penalties, ensuring they do not unfairly restrict the mortgagor's
right to redeem the property and upholding principles of fairness and equity in mortgage
agreements. Legal precedents continue to shape the evolving standards for evaluating the
validity of penalties within the complex landscape of clogs on redemption in Indian mortgage
law.

4. Collateral Benefit to Mortgagor

A mortgagor has the option to derive a collateral benefit either during the existence of the
mortgage, which is considered valid, or after redemption, a scenario that, in certain instances,
may be deemed invalid. In the legal case Noakes & Co. v. Rice28, a covenant in the mortgage
contract specified that the mortgagor, who was a brewer, would exclusively sell all the beer
consumed on his property to the mortgagee. It was established that this tie was permissible
during the term of the mortgage but not beyond the redemption period. The property must be
returned without any binding exclusivity arrangement.

A significant case regarding collateral benefits is Kreglinger v. New Patagonia Meat and
Cold Storage Co. Ltd29. In this instance, the mortgage term was five years, with an option for

28
1902 AC 24.
29
1914 AC 25.
the mortgagor to redeem the property before the term's completion. The agreement further
dictated that the mortgagor should exclusively sell sheepskins to the mortgagee at an agreed-
upon fixed price. When the mortgagee paid off the mortgage before the stipulated five years
and initiated legal proceedings to declare the exclusive selling tie as a clog on redemption, the
House of Lords ruled that the provision did not amount to a clog. It was reasoned that a
mortgagee is permitted to negotiate for a collateral benefit beyond the redemption period,
provided the stipulation is not unconscionable, unfair, constitutes a penalty impeding the right
to redeem, or contradicts the right of redemption.

The Kreglinger case is pivotal in delineating the constraints of the doctrine, acknowledging
the legitimacy of contractual terms unless they are oppressive, unconscionable, or
unreasonably stringent30. This case emphasizes the freedom of contracting parties.

The principle enunciated in Kreglinger found endorsement in the case of re Cuban Land and
Development Co.31In this instance, a provision stipulated that in the event of the company's
winding up, debenture-holders were entitled to a portion of the remaining profits. This
provision was not considered a penalty impinging on the right of redemption. Indian courts
have also endorsed this principle, as seen in cases where a provision allowing the mortgagee
to retain possession of the mortgaged property through permanent tenancy was deemed a clog
because the collateral benefit extended beyond the redemption period.

5. Subsequent Agreement to postpone redemption

A subsequent agreement that acts as an impediment to the mortgagor by establishing a

personal obligation is considered a clog on the right to redemption 32. This is because, unless
the agreement constitutes a charge on the property, the mortgagee is not obligated to make
any payments arising from their personal obligation, except for the mortgage amount. In the
legal case of Sheo Shankar v. Parma33, the mortgagor had previously executed a usufructuary
mortgage in favor of the mortgagee. Subsequently, the mortgagor executed a simple mortgage
to secure additional funds. A provision in the simple mortgage contract stated that the
mortgagor was prohibited from redeeming the property until the amount specified in the

30
2 Sir Hari Singh Gour, The Transfer of Property Act, 1882 1248 (10th ed., 2002).
31
1921) 2 Ch 147.
32
1 Sanjiva Row, Transfer of Property Act 884 (7th ed., 2011).
33
I LR 26 All 559.
simple mortgage was repaid. The court determined that such a provision was void as a clog
on the right to redemption.

In the case of Hari v. Vishnu34, a loan of ₹1500 was advanced to the plaintiff through a
mortgage by the defendant. The mortgage deed stipulated that an additional ₹5000 was
outstanding on a previous mortgage, and until both sums were settled, the plaintiff was not
entitled to redeem the property. The deed was stamped at a value of ₹6500. The court held
that since both transactions were amalgamated into one, the provision did not qualify as a
clog on redemption.

EXCEPTIONS TO THE CLAUSE OF REDEMPTION

Every rule has an exception to it, so even the right to Redemption has some limitations, even
though it can’t be extinguished but it may be restricted.

In the case of Seth Ganga Dhar v. Shankar Lal35, the Court held that while the Court had the
power of relieving the mortgagor from any such clause of the contract which restricts the
exercise of his right of redemption, the Court must take into consideration the relevant facts
and circumstances of that particular case to determine whether the mortgagor was coerced
into entering into such agreement by taking advantage of his weaker bargaining position. In
this case the property was mortgaged for a period of 85 years. The Court while deciding on
the validity of this period observed that it did "not think that all the terms were for the benefit
of the mortgagee, or that what there was in the instrument was for his benefit and indicated
that the mortgagee had forced a hard bargain on the mortgagor. We have earlier said how the
bargain appears to us to have been fair and one as between parties dealing with each other on
equal footing". Thus, where the Court finds the mortgagor and mortgagee to be on equal
footing, the clause would be held to be valid. However, the Court held that a clause providing
that the mortgagor must redeem the property within the 6 months of the expiry of the 85
years period was invalid. Only where the Court is satisfied that the mortgagor has been
unfairly trapped by the mortgagee, the Court will step in and relieve the mortgagor from such
unfair bargain.

34
ILR 28 Bom 349.
35
[AIR 1958 SC 770]
The exceptions exist in the following manner-

1. The right of redemption cannot be finished in mortgage deed of the agreement but after it
can be finished by submission of the right of redemption or by sale or by any method by
the free transaction.
2. The right can be finished by the decree of court. the mortgagor only has the right to get
such decree the right of redemption can be awaited till exercising after the degree for
forfeiture of the right of redemption can be passed by the court.
3. If the right of redemption and interest of mortgage vested in one person then the right is
finished.
4. If the mortgaged property is vested in-state or if the mortgaged property acquisition by
the government the right.
5. Lastly, if the mortgagee himself acquires a share in the mortgaged property, the
indivisibility of the mortgage is broken, and sharer in the remaining or integrity property
is then entitled to redeem his share.
6. Power to seek redemption is subject to limitation. Section 61(a) of the Limitation Act,
1963 provides that the right of redemption will cease after the expiry of a 30-year period
from the accrual of the right. The proviso to Section 60, TPA which provides that where
the time fixed for repayment of principal amount has lapsed, this right cannot be
exercised if a suit is filed before the Court of law and a decree is passed by the Court
against the mortgagor. Furthermore, where the mortgaged property is acquired by the
state, then the right of redemption would cease. In the case of Moro v. Balaji36, it was held
that where the mortgagee himself acquires a share of the mortgaged property, he would be
entitled to keep such share and the mortgagor can redeem his share.

Narandas Karsondas vs S.A. Kamtam & Anr- It is only on execution of the conveyance
and registration of transfer of the mortgagor's interest by registered instrument that the
mortgagor's right of redemption will be extinguished. The conferment of power to sell
without intervention of the Court in a Mortgage Deed by itself will not deprive the mortgagor
of his right to redemption. The extinction of the right of redemption has to be subsequent to
the deed conferring such power. The right of redemption is not extinguished at the expiry of
the period. The equity of redemption is not extinguished by mere contract for sale. The

36
Moro Raghunath vs Balaji Trimbak (1889) ILR 13 Bom 45.
mortgagor's right to redeem will survive until there has been completion of sale by the
mortgagee by a registered deed. 37

L.K. Trust Vs EDC Ltd. and Others Respondent- The mortgagor under Indian law is the
owner who had parted with some rights of ownership and the right of redemption is the right
which he exercises by virtue of his residuary ownership to resume what he has parted with. In
India this right of redemption, however, is statutory one. A right of redemption is an incident
of a subsisting mortgage and subsists so long as the mortgage itself subsists. The judicial
trend indicates that dismissal of an earlier suit for redemption whether as abated or as
withdrawn or in default would not debar the mortgagor from filing a second suit for
redemption so long as the mortgage subsists. This right cannot be extinguished except by the
act of parties or by decree of a court. 38

Jaya Singh D. Mhoprekar and Anr.v. Krishna Balaji Patil and Anr. - The right of
redemption under a mortgage deed can come to an end only in a manner known to law. Such
extinguishment of the right can take place by contract between the parties, by a merger or by
statutory provision which debars the mortgager from redeeming the mortgage. The
mortgagor’s right of redemption is exercised by the payment or tender to the mortgagee at the
proper time and at the proper place of the mortgage money. When it is extinguished by the act
of parties, the act must take the shape and observe the formalities which the law prescribes. A
mortgage being a security for the debt, the right of redemption continues although the
mortgagor fails to pay the debt at the due date. Any provision inserted to prevent, evade or
hamper redemption is void. 39

37
1977 AIR 774, 1977 SCR (2) 341.
38
AIR 2011 SC 2060.
39
(1985) 4 SCC 162.
 CONCLUSION

The determination of the validity of the clog on redemption doctrine necessitates a

meticulous examination of the mortgage deed, considering the surrounding circumstances
that led to the parties entering into the mortgage, the amount advanced, and the nature of the
transaction.

However, the application of this doctrine has not been without contention. Sir Frederick
Pollock expressed dissatisfaction, labelling the doctrine as an 'anachronism' 40. He argued that
the doctrine tends to presume the mortgagor as a victimized party, an assumption that may
not hold true in the modern era. In his view, both parties now stand on an equal footing, and
allowing a mortgagor to repudiate obligations by deeming a clause unconscionable goes
against the broader public policy.

Over time, with the evolution of commerce and societal progress, such disparities have
significantly diminished. Offering a justification for one party to evade obligations based on
the portrayal of a contract clause as unconscionable sets a problematic precedent. Despite
these criticisms, Indian courts continue to apply this test. In a country where a significant
portion of the population is engaged in the agrarian sector, living below the poverty line
without access to formal banking systems, the doctrine still finds relevance in specific
situations. The judiciary is entrusted with the discretion to determine the judicious application
of this doctrine in particular cases.

40
19 L. Q. Rev. 359 (1903)