The proper remedy for the mortgagee in a mortgage by conditional sale is:
- To institute a suit for sale
- To suit for recovery of money
- To institute a suit for foreclosure
- Both (A) and (B)
The Correct Option is C
Solution and Explanation
In the context of legal studies, particularly regarding mortgages by conditional sale, the correct remedy for a mortgagee is important to determine based on the nature of the agreement. According to Section 58(c) of the Transfer of Property Act, an agreement qualifies as a mortgage by conditional sale if it involves an ostensible sale with possession and ownership transfer, but includes a clause for reconveyance. A mortgage by conditional sale differs from a sale with a retransfer option, the latter being evidenced by more than one document and not classified as a mortgage.
A mortgage by conditional sale must establish a debtor-creditor relationship, with the property's valuation, transaction value, and reconveyance duration being key considerations. These factors, together with the agreement's recitals, the parties' intentions, and other circumstances, must be holistically evaluated. The language of the agreement alone doesn't determine its nature.
Given these considerations, the proper legal remedy available to a mortgagee in a mortgage by conditional sale is to institute a suit for foreclosure. This action aligns with the nature and framework of a mortgage by conditional sale where reconveyance conditions are stipulated within the mortgage document itself, thereby making foreclosure the suitable legal course of action.
One of the conditions of mortgage by conditional sale is that:
- On payment of mortgage money, the sale shall be voidable
- On payment of mortgage money, the sale shall become void
- The mortgagee shall receive the rent and profits and will appropriate the same towards the dues
- All of the above
The Correct Option is B
Solution and Explanation
The condition described as a mortgage by conditional sale refers to a situation where the sale of property is conducted with an ostensible transfer of ownership but includes a clause for reconveyance. This is provided in Section 58(c) of the Transfer of Property Act.
According to this section, if the mortgage money is paid, the sale will become void. This is a defining characteristic of a mortgage by conditional sale, as it establishes a debtor and creditor relationship. It ensures that after fulfilling the financial obligation (by paying the mortgage money), the mortgagor can reclaim the property, thus rendering the sale void.
This contrasts with a sale with a condition of retransfer, which may involve more than one document and does not create a mortgage.
Based on the definitions and legal context, the correct answer to the question regarding the condition of a mortgage by conditional sale is:
On payment of mortgage money, the sale shall become void.
What is the common clause between mortgage by conditional sale and English mortgage?
- Transfer of ownership of mortgaged property
- Transfer of possession of mortgaged property
- The right of mortgagee to sell the property
- Delivery of documents of title
The Correct Option is A
Solution and Explanation
In legal terms, both "mortgage by conditional sale" and "English mortgage" involve the concept of transferring ownership of the mortgaged property. Let's explore this commonality in more detail:
Mortgage by Conditional Sale: According to Section 58(c) of the Transfer of Property Act, a mortgage by conditional sale occurs when the mortgagor ostensibly sells the property to the mortgagee with the condition that upon the repayment of the mortgage money, the property will be reconveyed to the mortgagor. The transaction resembles a sale with a condition of repurchase but is fundamentally a mortgage. The critical aspect is that it must be documented as a single transaction with the reconveyance condition explicitly stated.
English Mortgage: In an English mortgage, both the ownership and possession of the property are transferred to the mortgagee. The mortgagor binds himself to repay the borrowed sum on a specific date, and the mortgagee agrees to reconvey the property upon repayment. Here, the transfer of ownership is absolute initially, with an agreement for reconveyance upon payment.
The common clause between both types is the transfer of ownership of the mortgaged property to the mortgagee. In both arrangements, the ownership initially shifts from the mortgagor to the mortgagee, embodying a security measure for the loan provided. However, unlike a simple sale, both types involve conditions that potentially allow the mortgagor to reacquire the property upon meeting specific requirements.
Conclusion: Based on this explanation, the correct answer to the original question is the transfer of ownership of the mortgaged property.
What is the limitation period in case of mortgage by conditional sale?
- 3 years
- 12 years
- 30 years
- No time limit
The Correct Option is B
Solution and Explanation
Which of the following expresses the distinction between a mortgage by conditional sale and a sale with a condition of repurchase?
- In a mortgage the debt subsists and a right to redeem remains with the debtor, but a sale with a condition of repurchase is not a lending and borrowing arrangement
- In a mortgage by conditional sale, generally the amount of consideration is far below the value of the property in the market, but in a sale with a condition of repurchase, the amount of consideration is generally equal to or close to the value of the property
- Both (A) and (B)
- Neither (A) nor (B)
The Correct Option is C
Solution and Explanation
In the context of legal agreements, determining whether a transaction constitutes a mortgage by conditional sale or a sale with a condition of repurchase is complex. The two concepts differ markedly in their legal implications and are governed by specific statutes.
A mortgage by conditional sale is defined under Section 58(c) of the Transfer of Property Act. It involves an ostensible sale of property with the inclusion of a clause for reconveyance upon fulfillment of certain conditions. The key elements of this agreement are:
- Transfer of possession and ownership is apparent, but the transaction is intended to secure a debt.
- The original document contains a reconveyance condition, retaining the debtor's right to redeem the property.
- A single document generally evidences the entire agreement.
In contrast, a sale with a condition of repurchase involves:
- Complete transfer of ownership and possession without implying a debtor-creditor relationship.
- The transaction might be documented in more than one document.
- Reacquisition of the property is purely at the discretion of the purchaser and depends on fulfilling specific conditions within a specified period.
Key differences between these transactions include:
| Aspect | Mortgage by Conditional Sale | Sale with Condition of Repurchase |
|---|---|---|
| Nature of Transaction | Debt arrangement; property serves as security | Complete sale; no underlying debt relationship |
| Number of Documents | One document | Possibly multiple documents |
| Valuation | Amount typically less than property value | Amount close to property value |
Therefore, both options (A and B) accurately capture the distinctions between these types of agreements, making the correct answer: Both (A) and (B).
Top Questions on Property Law
- A suit for recovery of possession of immovable property under Section 6 of the Specific Relief Act, 1963 can be instituted by a person who has been dispossessed ____.
- AILET LLM - 2026
- Legal Studies
- Property Law
- Which of the following is not required to prove a Will?
- AILET LLM - 2026
- Legal Studies
- Property Law
- The general rule for the apportionment of income between the transferor and transferee under Section 36 of the Transfer of Property Act, 1882 is that such income shall be deemed to accrue due from
- AILET LLM - 2026
- Legal Studies
- Property Law
- The Universal Donee is liable for
- AILET LLM - 2026
- Legal Studies
- Property Law
- Choose the correct answer regarding the doctrine of part performance.
- AILET LLM - 2026
- Legal Studies
- Property Law
Questions Asked in CLAT PG exam
The document presents a critique of the United Nations (UN) organization, arguing that it has failed to carry out its charter-mandated tasks, specifically to ”maintain international peace and security” and ”to achieve international cooperation” in solving global problems. The author notes growing public frustration with catastrophic humanitarian situations and the failure of peace-keeping operations, leading to widespread scepticism about the possibility of ”revitalization”.
UN Reform Approaches
Discussions on UN reform are divided into two main categories: the conservative approach and the radical approach.
1. Conservative Approach:
The conservative view considers the existing Charter ”practically untouchable” and believes in improving ”collective security” as defined in Chapter VII. Key positions include:
- US Position: Prioritizes its own interests, supports better management and the creation of an Inspector General, favours enlarging the Security Council (to include Germany and Japan, mainly for financing peace-keeping), and associates the UN with regional organizations like NATO for peace enforcement. The US remains reluctant to allow full application of Chapter VII and views collective security restrictively.
- Secretary-General’s Position (Boutros Ghali): Advocated for the full implementation of ’collective security’ as envisaged in 1945, including the use of the Military Staff Committee (Article 47) and the conclusion of special agreements (Article 43) for providing armed forces. He also proposed ’peace enforcement units’ under the command of the Secretary-General and wider use of ’preventive diplomacy’. The report candidly recognized the Security Council’s incapacity to deal with threats from a major power.
2. Radical Approach:
The radical approach criticizes the principles of the present system and proposes an overhaul. It reflects increasing doubts about the value of the Charter’s collective security system, especially in intra-State conflicts. Radical proposals include:
- Establishing an Economic Security Council.
- Modifying the Charter with less reluctance.
- Reforming the IMF and World Bank.
- Developing a new global security system .
- The creation of a consultative parliamentary assembly at the world level.
Future Outlook:
The author asserts that no major or minor reform has any chance of being implemented now, primarily because the Charter’s amendment procedures (requiring a two-thirds majority including all five permanent Security Council members) preclude agreement. However, he concludes that the continuing deterioration of the global situation, driven by economic integration, rising inequality, and intra-State conflicts, will inevitably lead the political establishment to define a new global institutional structure. This future debate will become highly political.
- CLAT PG - 2026
- International Law
“Section 55 of the Indian Contract Act says that when a party to a contract promises to do a certain thing within a specified time but fails to do so, the contract or so much of it as has not been performed, becomes voidable at the option of the promisee if the intention of the parties was, that time should be of the essence of the contract. If time is not the essence of the contract, the contract does not become voidable by the failure to do such thing on or before the specified time but the promisee is entitled to compensation from the promisor for any loss occasioned to him by such failure. Further, if in case of a contract voidable on account of the promisor’s failure to perform his promise within the time agreed and the promisee accepts performance of such promise at any time other than that agreed, the promisee cannot claim compensation for any loss occasioned by the non-performance of the promise at the time agreed, unless, at the time of such acceptance he gives notice to the promisor of his intention to do so.
Sections 73 and 74 deal with consequences of breach of contract. Heading of Sec tion 73 is compensation for loss or damage caused by breach of contract. When a contract is broken, the party who suffers by such breach is entitled to receive from the party who has broken the contract compensation for any loss or damage caused to him thereby which naturally arose in the usual course of things from such breach or which the parties knew when they made the contract to be likely to result from the breach of it. On the other hand, Section 74 deals with compen sation for breach of contract where penalty is stipulated for. When a contract is broken, if a sum is mentioned in the contract as the amount to be paid in case of such breach or if the contract contains any other stipulation by way of penalty, the party complaining of the breach is entitled whether or not actually damage or loss is proved to have been caused thereby, to receive from the party who has broken the contract reasonable compensation not exceeding the amount so named or the penalty stipulated for.”
tracted from: Consolidated Construction Consortium Limited v Software Technol ogy Parks of India 2025 INSC 574- CLAT PG - 2026
- Contract Law
“Law treats all contracts with equal respect and unless a contract is proved to suffer from any of the vitiating factors, the terms and conditions have to be enforced regardless of the relative strengths and weakness of the parties.
Section 28 of the Contract Act does not bar exclusive jurisdiction clauses. What has been barred is the absolute restriction of any party from approaching a legal forum. The right to legal adjudication cannot be taken away from any party through contract but can be relegated to a set of Courts for the ease of the parties. In the present dispute, the clause does not take away the right of the employee to pursue a legal claim but only restricts the employee to pursue those claims before the courts in Mumbai alone.
... the Court must already have jurisdiction to entertain such a legal claim. This limb pertains to the fact that a contract cannot confer jurisdiction on a court that did not have such a jurisdiction in the first place.”
Extracted from: Rakesh Kumar Verma v HDFC Bank Ltd 2025 INSC 473- CLAT PG - 2026
- Contract Law
- “The law is well settled that a constitutional court can award monetary compen sation against the State and its officials for its failure to safeguard fundamental rights of citizens but there is no system or method to measure the damages caused in such situations. Quite often the courts have a difficult task in determining dam ages in various fact situations. The yardsticks normally adopted for determining the compensation payable in private tort claims are not as such applicable when a constitutional court determines the compensation in cases where there is a viola tion of fundamental rights guaranteed to its citizens.
... In D.K. Basu v. State of W.B. [(1997) SCC 1 416], a Constitution Bench of this Court held that there is no straitjacket formula for computation of damages and we find that there is no uniformity or yardstick followed in awarding damages for violation of fundamental rights. In Rudul Sah case [Rudul Sah v. State of Bihar, (1983) 4 SCC 141] this Court used the terminology ’palliative’ for measuring the damages and the formula of ’adhoc’ was applied. In Sebastian Hongray case [Se bastian M. Hongray v. Union of India, (1984) 3 SCC 82] the expression used by this Court for determining the monetary compensation was ’exemplary’ costs and the formula adopted was ’punitive’. In Bhim Singh case [Bhim Singh v. State of J & K, (1985) 4 SCC 677], the expression used by the Court was ’compensation’ and the method adopted was ’tortious formula’. In D.K. Basu v. State of W.B. [(1997) SCC 1 416] the expression used by this Court for determining the compensation was ’monetary compensation’. The formula adopted was ’cost to cost’ method. Courts have not, therefore, adopted a uniform criterion since no statutory formula has been laid down.”
tracted from: Municipal Corporation of Delhi, Delhi v Uphaar Tragedy Victims Association (2011) 14 SCC 481- CLAT PG - 2026
- Constitutional Laws
- It is well recognized that actionable negligence in context of medical profession involves three constituents (i) duty to exercise due care; (ii) breach of duty and (iii) consequential damage. However, a simple lack of care, an error of judgment or an accident is not sufficient proof of negligence on part of the medical professional so long as the doctor follows the acceptable practice of the medical profession in discharge of his duties. He cannot be held liable for negligence merely because a better alternative treatment or course of treatment was available or that more skilled doctors were there who could have administered better treatment.
A medical professional may be held liable for negligence only when he is not pos sessed with the requisite qualification or skill or when he fails to exercise reasonable skill which he possesses in giving the treatment. None of the above two essential conditions for establishing negligence stand satisfied in the case at hand as no ev idence was brought on record to prove that Dr. Neeraj Sud had not exercised due diligence, care or skill which he possessed in operating the patient and giving treatment to him. When reasonable care, expected of the medical professional, is extended or rendered to the patient unless contrary is proved, it would not be a case for actionable negligence.
tracted with edits and revisions from Neeraj Sud v Jaswinder Singh 2024 INSC 825- CLAT PG - 2026
- Law of Torts