Law:

Section:

Limitation Act (IX of 1908)--- ----First Sched., Art. 113---Specific Relief Act (I of 1877), S. 12---Suit for specific performance of agreement to sell, filing of---Limitation---Subject property mortgaged with Bank---Question as to whether limitation period for filing suit for specific performance of agreement to sell started from date prescribed on such agreement or from the date when property was redeemed from the Bank---Agreement was entered into on 02-05-1983 and did have a specific date for its performance namely 28-5-1983---In the ordinary course it was the first limb of Art.113 of the First Schedule to the Limitation Act, 1908 that would have applied and the suit would have become barred by limitation after 3 years i.e. 28-5-1986---High Court, however, took the view that since the property was mortgaged limitation did not begin to run till such time as it was redeemed which came about around 28-11-1988---Legality---When a property was mortgaged by one person to another the interest that was left in the hands of the mortgager was called the equity of redemption---Equity of redemption was itself immovable property which could be dealt with as such by the mortgager, whether by way of sale, subsequent mortgage, gift or transfer but subject always to the rights and interests of the mortgagee---Existence of a mortgage on immoveable property did not in or itself constitute a bar to subsequent dealing by the mortgager as regards the equity of redemption---Mortgager could enter into an agreement to sell subsequent to the creation of the mortgage---Existence of the mortgage had no bearing on the question of limitation for the specific enforcement of the agreement to sell---High Court erred materially in concluding that limitation did not begin to run till the property was redeemed---Limitation began to run from the date of performance as given in the agreement, as stipulated by the first limb of Art.113 of the Limitation Act, 1908---In the present case, therefore the suit for specific performance ought to have been brought by or before 28-05-1986---Since it was admittedly instituted on a much later date, it was hopelessly time barred and liable to be dismissed as…

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