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  • Section 110, Civil P.C.,
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Smart Summary

Factual and Procedural Background

This opinion concerns an application for leave to appeal to His Majesty in Council against the decree of a Bench of this Court in First Appeal No. 459 of 1923, decided on 21st December 1926. The appeal was dismissed and the decree of the trial Court was affirmed. The subject-matter value exceeded Rs. 10,000 both in the trial Court and in the proposed appeal. The applicant sought certification under Section 110, Civil P.C., on the ground that the appeal involved a substantial question of law or alternatively that it was otherwise a fit case for appeal.

The substantive issue in the lower Courts concerned the legal relationship of the parties arising from three documents executed on 22nd May 1915. The plaintiffs claimed to be mortgagors and the defendant, Mathura Kurmi, claimed to be the purchaser of the property with an option of re-purchase, which the plaintiffs allegedly failed to exercise. Both the trial Court and the first appellate Court held that the documents evidenced a single transaction constituting a mortgage by conditional sale and that the plaintiffs were entitled to redeem the property.

Legal Issues Presented

  1. Whether the appeal involves a substantial question of law under Section 110, Civil P.C.
  2. Whether the case is otherwise fit for certification to appeal to His Majesty in Council.
  3. Whether the three documents executed on 22nd May 1915 constitute a mortgage by conditional sale or a purchase with an option of re-purchase.
  4. The proper construction of the legal documents and the intention of the parties at the date of the transaction.

Arguments of the Parties

Plaintiffs' Arguments

  • The plaintiffs contended that they were mortgagors under a mortgage transaction evidenced by the three documents.

Defendant's Arguments

  • The defendant argued that he was the purchaser of the property subject to an option of re-purchase, which the plaintiffs failed to exercise.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Balkishen Das v. Legge [1899] 22 All. 149 Test for determining the intention of parties in transactions involving mortgages or conditional sales. Used to affirm that intention is a question of fact to be ascertained by the Court in construing the transaction.
Jhanda Singh v. Wahiduddin, A.I.R. 1916 P.C. 49 Principles for construing legal documents to determine the nature of the transaction. Referred to as settled law guiding the Court’s finding on the parties' relationship.
Narasingerji v. Parthasaradhi Rayanim Garu, A.I.R. 1924 P.C. 226 Clarification that intention is a matter of fact and governs the classification of the transaction. Applied to support the factual finding that the parties were mortgagor and mortgagee.

Court's Reasoning and Analysis

The Court analyzed the nature of the transaction evidenced by the three documents executed on 22nd May 1915, concluding that they represented a single transaction of mortgage by conditional sale. The Court emphasized that the primary test is the intention of the parties at the time of the transaction, which is a factual determination. Both the trial Court and the appellate Court found the parties’ relationship to be that of mortgagor and mortgagee.

Regarding the question whether any substantial question of law arose, the Court noted that any legal question related to the interpretation of the documents was not of general interest but only relevant to the parties involved. Although recent Privy Council decisions suggested that a substantial question of law need not be of general interest, the Court was not persuaded that the legal principles had been misapplied or that the appeal would lead to the development of new legal principles.

Consequently, the Court held that the case did not satisfy the conditions of Section 110, Civil P.C., for certification of a substantial question of law, nor was it fit for certification on any other ground. The application for leave to appeal was therefore dismissed with costs.

Holding and Implications

The application for leave to appeal to His Majesty in Council is dismissed with costs.

The decision affirms the factual finding that the transaction was a mortgage by conditional sale and confirms that no substantial question of law arises warranting further appeal. This ruling directly affects the parties by upholding the decree of the trial Court and first appellate Court. No new legal precedent was established by this decision.

    Mathura Kurmi v. Jagdeo Singh

    1. This is an application for leave to appeal to His Majesty in Council against the decree of a Bench of this Court in First Appeal No. 459 of 1.923, decided on the 21st December, 1926. The appeal was dismissed and the decree of the trial Court was affirmed. The value of the subject-matter in the first Court was over Rs. 10,000 and the value of the subject-matter of the proposed appeal to His Majesty is also above that sum. But we are asked to certify that the case fulfills the conditions of Section 110, Civil P.C., on the ground that the appeal involves a substantial question of law, or, in the alternative, to certify that it is otherwise a fit case for appeal.

    2. The question which arose for decision in the Court below and in this Court was with regard to the legal relation of the parties arising out of the execution of three documents executed on the 22nd May 1915. The case for the plaintiffs was that they were mortgagors and that the defendant, Mathura Kurmi, was their mortgagee. The defendant's case was that he was the purchaser of the property in dispute subject to an option of re-purchase of which the plaintiffs had failed to take advantage.

    3. The decision of the trial Court, affirmed in this Court, was that the three documents were evidence of a single transaction, namely, a mortgage by conditional sale, and that the plaintiffs were entitled to recover the property by redemption. As is pointed out in the judgments delivered in this Court, cases of this nature are frequently brought before the Courts in India, and many of them have been taken in appeal to His Majesty in Council. We may refer in particular to the following three cases:

    4. Balkishen Das v. Legge [1899] 22 All. 149, Jhanda Singh v. Wahiduddin A.I.R. 1916 P.C. 49 and Narasingerji v. Parthasaradhi Rayanim Garu A.I.R. 1924 P.C. 226. It has been settled definitely that the test to be applied in such cases is the intention of the parties at the date of the transaction which has to be construed and the decisions lay down the various matters which may legitimately be considered by the Courts in order to determine what the intention of the parties was. Intention is a matter of fact and not of law and where, as in the case now before us, both Courts find that the parties stand in the relation of mortgagor and mortgagee, the finding is one of fact, namely, that on the date on which the parties entered into the transaction their intention was to constitute that relation between themselves.

    5. If it be admitted, however, that the question is not one of pure fact because the decision involves the construction of legal documents, the point remains whether any question of law is raised which can be deemed to be a substantial question. Obviously any question of law arising upon the interpretation of the documents considered in this case is not substantial in the sense of being a question of general interest: it is of importance only to the present parties. But, in view of a recent decision of their Lordships, it is contended that a question of law, in order to be substantial, need not be a question of general interest: it may still be substantial although it concerns only the parties to the litigation. And so it is sought to be argued that we have here a question of substance because, it is suggested, that the tests and principles of interpretation prescribed by the Privy Council have not been correctly applied to the facts.

    6. We are not prepared to hold that for this reason the question of law between the parties here, assuming it to arise at all, is a substantial question. It is not made to appear that the appeal, if allowed to proceed, could furnish an occasion for the discussion or enunciation of any fresh legal principle. The matter has been agitated time and again before their Lordships who have repeatedly laid down the law in the sense indicated above. In these circumstances we do not think that the application of well defend legal principles to a particular set of facts raises any question of law which can fairly be described as substantial. The case does not, in our opinion, fulfill the requirements of Section 110, Civil P.C., Nor is it a case which we could certify as being otherwise fit for appeal to His Majesty. We dismiss the application with costs.

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    Mathura Kurmi v. Jagdeo Singh
    (Jun 7, 1927)