Explain in full as to what do you understand by clog on redemption. Give two illustrations of conditions......

Question: Explain in full as to what do you understand by clog on redemption. Give two illustrations of conditions which would operate 'as clog' on redemption answer properly, this question is of Transfer of Property Act. [BJS 1977]

Find the answer to the mains question of Property Law only on Legal Bites. [Explain in full as to what do you understand by clog on redemption. Give two illustrations of conditions which would operate 'as clog' on redemption answer properly, this question is of Transfer of Property Act.]

Answer

The doctrine of “clog on redemption” is a fundamental principle under the Transfer of Property Act, 1882, particularly concerning mortgages. The doctrine originates from Section 60 of the Act, which grants the mortgagor (borrower) an absolute right to redeem the mortgaged property upon repayment of the mortgage money.

In simple terms, a clog on redemption refers to any condition or stipulation inserted in a mortgage agreement that prevents, obstructs, restricts, or postpones the mortgagor’s right to redeem the property. Such a condition is considered void and unenforceable, as "once a mortgage, always a mortgage" — meaning a mortgage cannot be turned into an outright sale or used to unjustly benefit the mortgagee.

Section 60, Transfer of Property Act, 1882

“At any time after the principal money has become due, the mortgagor has a right, on payment or tender… to require the mortgagee to re-transfer the property to him...”

The right to redeem is inherent in a mortgage transaction and cannot be fettered by any unconscionable bargain, onerous condition, or restrictive clause.

In Pomal Kanji Govindji v. Vrajlal Karsandas Purohit (1989 AIR 436)

The Supreme Court held that if a condition prevents or makes redemption illusory, it would be treated as a clog on the mortgagor’s right.

Here are two illustrations where conditions operate as a clog on redemption:

Illustration 1: Postponement of Redemption for an Unreasonably Long Period

Suppose A mortgages his house to B for ₹5 lakhs with a condition that A cannot redeem the property for 40 years, even after the full amount is repaid.

Explanation: This condition unreasonably postpones the mortgagor’s right to redeem and hence constitutes a clog.

Illustration 2: Mortgage with Conditional Sale

A mortgages land to B with a condition that if the money is not repaid in one year, the property will automatically be transferred to B absolutely. Even if A offers the repayment after one year, B refuses to return the property.

Explanation: This amounts to a sale disguised as a mortgage and denies the right of redemption. Such a condition is a clog and void.

The doctrine of clog on redemption ensures that the true nature of a mortgage — a security for repayment of a debt — is preserved, and the mortgagor is not unjustly deprived of their property. Any clause or agreement that hampers the mortgagor’s right to redeem the property upon repayment of debt is illegal, void, and unenforceable.

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