Unregistered deed can prove adverse possession changed from mortgagee's permissive holding, barring redemption by limitation.

An unregistered instrument affecting mortgaged immovable property was inadmissible as a conveyance, but it could still be used for the collateral purpose of showing that the mortgagee's possession changed in character from permissive holding under the mortgage to possession asserted as owner. On that basis, the possession became adverse from 28 February 1901. Continuous adverse possession for the statutory period then barred the mortgagor's suit for redemption and extinguished the right to recover the property.

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Issues: (i) Whether the unregistered deed dated 28 February 1901 was admissible in evidence for the limited purpose of showing a change in the character of the mortgagee's possession; (ii) Whether the mortgagee's possession became adverse after 1901 so as to bar the suit for redemption by limitation.

Issue (i): Whether the unregistered deed dated 28 February 1901 was admissible in evidence for the limited purpose of showing a change in the character of the mortgagee's possession.

Analysis: The transfer purported to deal with the mortgagor's interest in mortgaged immovable property, and on the facts there was no actual delivery of possession. The deed was therefore ineffective as a conveyance, and the transaction required registration. However, the question under consideration was whether the document could still be looked at to prove the nature of possession and the intention that the mortgagee should thenceforth hold as owner. For that collateral purpose, the document was not excluded by Section 49 of the Registration Act, 1877.

Conclusion: Yes. The deed was admissible in evidence for the limited purpose of showing the change in the character of possession.

Issue (ii): Whether the mortgagee's possession became adverse after 1901 so as to bar the suit for redemption by limitation.

Analysis: The mortgagee had previously been in permissive possession as mortgagee. The unregistered deed evidenced a clear assertion that he should thenceforth hold as proprietor and that the mortgagor's connection with the property should cease. Even though the deed did not pass title, it recorded an agreement that changed the basis of possession. On that footing, the possession ceased to be referable to the mortgage and became adverse from the date of the deed. Continuous adverse possession for twelve years thereafter extinguished the mortgagor's right and that of his successor.

Conclusion: Yes. The possession became adverse from 28 February 1901, and the suit was barred by limitation.

Final Conclusion: The appeal succeeded, the plaintiffs' claim for redemption failed, and the right to recover the property was held to have been extinguished by adverse possession.

Ratio Decidendi: An unregistered instrument that is ineffective to transfer title may still be admitted to prove the parties' intention and the collateral fact that possession changed from permissive to adverse, and where such adverse possession continues for the statutory period, the right of redemption is barred.

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