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Issues Involved:
1. Whether Ex. 1 was a mortgage by conditional sale or an out and out sale. 2. Whether the suit is barred under Article 61(b) of the Limitation Act, 1963. Detailed Analysis: 1. Nature of Ex. 1: Mortgage by Conditional Sale or Out and Out Sale The primary issue was whether Ex. 1 constituted a mortgage by conditional sale or an outright sale. Both the trial court and the appellate court found that Ex. 1 was indeed a mortgage by conditional sale. The mortgage was statutorily redeemed in 1945 after the lapse of 15 years from the date of the mortgage (5-9-1930) under Section 17 of the Orissa Money-Lenders Act. Consequently, the suit was treated as one for the recovery of possession under Article 61(a) of the Limitation Act, 1963, and the plea of limitation was rejected on the grounds that 30 years had not lapsed since 5-9-1945 when the right to recover possession accrued to the plaintiffs. 2. Limitation under Article 61(b) of the Limitation Act, 1963 The appellants contended that the suit, filed on 14-10-1966, was barred under Article 61(b) of the Limitation Act, 1963, which corresponds to Article 134 of the old Limitation Act, 1908. Article 61(b) stipulates a 12-year limitation period for recovering possession of immovable property mortgaged and afterwards transferred by the mortgagee for valuable consideration, starting from when the transfer becomes known to the plaintiff. To invoke Article 61(b), the following elements must be established: - The suit property was mortgaged. - A larger interest in the property than justified by the mortgage was transferred by the mortgagee for valuable consideration. - The transferee continued in possession for 12 continuous years or more since the date when the transfer became known to the plaintiffs. The defendants proved the sale deed of Baidyanath to Kishore Mohan (Ex. A/1) and the subsequent sale deed by Kishore Mohan to Pratima Devi (Ex. B/1). Ex. 1 was for Rs. 100 for 1.27 acres, and about 20 years after the mortgage period ended, the mortgagee sold part of the property to Kishore Mohan for Rs. 200, indicating a transfer of a larger interest than justified by the mortgage. This was corroborated by the recitals in Ex. A/1 and Ex. B/1, where the sellers claimed absolute ownership and transferred unrestricted rights to the purchasers. The third element required establishing when the plaintiffs became aware of the first transfer to Kishore Mohan. The defendants demonstrated possession since 6-1-1954, and subsequent possession by Pratima Devi from 30-6-1958 until her death, with all transfers being registered deeds, creating a presumption of constructive notice to the plaintiffs. The burden then shifted to the plaintiffs to prove that their suit was within the limitation period by showing they learned of the transfer within 12 years of filing the suit. The lower appellate court failed to address the date of the plaintiffs' knowledge of the transfer under Ex. A/1. Given the legal requirement for the plaintiffs to prove their case within the limitation period and the absence of evidence on this aspect, it was deemed inequitable to dismiss the suit without giving the plaintiffs an opportunity to discharge their onus. Conclusion: The case was remanded to the trial court with instructions to allow the plaintiffs to provide evidence that they became aware of the transfer under Ex. A/1 within 12 years of filing the suit. The trial court must then allow the defendants to rebut this evidence, determine the date of the plaintiffs' knowledge, and finally decide on the question of limitation and the suit. The findings regarding the nature of Ex. 1 and other elements of Article 61(b) are to be considered final and not subject to reopening. Costs will abide by the result of the fresh disposal.
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