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1921 Supreme(SC) 22
PRIVY COUNCIL [ON APPEAL FROM THEEAST INDIES]
VISCOUNT HALDANE, VISCOUNT FINLAY, LORD DUNEDIN, LORD SHAW, LORD MOULTON, SIR JOHN EDGE, AND MR. AMEER ALI.
BISWANATH PRASHAD - Appellant
Versus
CHANDRA NARAYAN CHOWDHURI - Respondents
On appeal from the High Court at Calcutta.
Decided On : Mar. 1. 1921.
Important Points
Subject
Property Law - Mortgage and Registration
Act Referred
Headnote
(B) Transfer of Property Act, 1882 - Section 54 - Sale of tangible immovable property of value less than Rs. 100 - Validity depends on either a registered instrument or delivery of possession - Mere execution of an unregistered instrument without delivery of possession does not transfer title.
Facts of the case:
A mortgage bond was executed to secure a debt. The primary property was situated in one district, but the bond was registered in another district. To justify this registration, the bond included a very small share of property located in the district of registration. It was alleged that this small share had been purchased by the mortgagor shortly before the mortgage, but the sale deed was unregistered and no possession was delivered. The respondents challenged the validity of the mortgage on the ground that it was not registered in accordance with the law.
Findings of Court:
The court found that the small share of property was never validly transferred to the mortgagor as there was neither registration nor delivery of possession. The inclusion of this property in the mortgage bond was a mere device to enable registration in a specific district and was not intended to form part of the security.
Issues: Whether the registration of a mortgage bond is valid when it is based on a fictitious entry of a small portion of property, which the mortgagor did not own and did not intend to mortgage, solely for the purpose of obtaining registration in a particular district.
Ratio Decidendi: An entry intentionally made use of by parties for the purpose of obtaining registration in a district where no part of the property actually charged and intended to be charged exists is a fraud on the registration law, and no registration obtained by means thereof is invalid. The lack of real intention to transfer or mortgage the nominal property renders the registration void.
Result: Appeal dismissed.
Legal Category Hierarchy
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property law
-
mortgage
- registration
-
transfer of property
- sale
-
mortgage
-
practice and procedure
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civil litigation
- mortgage enforcement
-
civil litigation
Judgement
Appeal (No. 83 of 1918) by special leave from a judgment and decree of the High Court (March 17, 1915) reversing a decree of the District Judge of Darbhanga.
Mathura Prashad, since deceased and represented by the appellants, sued the respondents to enforce a mortgage bond for Rs. 8000 dated February 27, 1902. The bond, which was registered under the Indian Registration Act, 1877, in the Mozufferpur district only, purported to mortgage a 7-annas share in a village in the Darbhanga district and a one-kauri share in a village in the
Law. Rep. 48 Ind. App. 127 ( 1920- 1921) Biswanath Prashad V. C handra Narayan C howdhuri
34
Mozufferpur district. The mortgagor had purchased the one-kauri share shortly before executing the mortgage under circumstances which appear from the judgment of their Lordships.
The trial judge gave the plaintiff a decree, being of opinion that he was the owner of the one-kauri share, and that the registration was valid.
The High Court reversed the decree. The learned judges (Sharfuddin and Coxe JJ.) were of opinion that the one-kauri share was not validly transferred to the mortgagor, and that it was not intended that it should pass under the mortgage.
The Judicial Committee granted special leave to appeal. The appeal was originally argued for the appellants in May, 1920, but was ordered to be reargued.
1921. Feb. 3. De Gruyther K.C. and Abdul Majid for the appellants. The mortgage was validly registered in the Mozufferpur district under the Indian Registration Act, 1877. Sect. 65 provides that the office in which registration is effected shall communicate the registration to each sub-district in which any portion of the property is situate. It is therefore immaterial under s. 27 how small is the property situate in the particular sub-district in which registration takes place Hari Ram v. Dial Ram . (( 1888) L. R. 16 I. A. 12.) The one-kauri share being of a value less than Rs. 100 could be validly transferred under the Transfer of Property Act, 1882, s. 54, without a registered instrument. The execution and delivery of the kobala to the mortgagor was a symbolic delivery of possession to him and satisfied that section. The present case is distinguishable from Harendra Lal Roy Chowdhuri v. Hari Dasi Debi (L. R. 41 I. A. 110.) because in that case the property named was non-existent.
A mere defect in the title of the mortgagor to the property within the district of registration does not invalidate a registration. To so hold would produce grave inconvenience, since an unsuspected defect of title in a small portion of property mortgaged might vitiate the whole mortgage. The evidence did not support the view that the parties did not intend that the one kauri should form part of the mortgage security. The respondents did not appear.
1921. March 1. The judgment of their Lordships was delivered by
VISCOUNT FINLAY. The action to which this appeal relates was brought to enforce a mortgage upon land. Its validity was challenged by the defendants on the ground that it has not been registered in accordance with the Indian Registration Act, 1877, and was, therefore, inoperative. A registration had been effected, but it was alleged for the defence that it was void, as no part of the property to which the mortgage related was situate within the district of the sub-registrar in whose office the mortgage was presented for registration.
The High Court held, reversing the district judge, that the mortgage was invalid, on the ground that it had not been duly registered.
This appeal was brought by the representatives of the mortgagee, praying (1.) that the mortgage should be put in force against the land; and (2.) in the alternative, that under the head of general relief judgment should be given against the defendants personally for payment of the amount of the debt.
There was no appearance on this appeal on behalf of the respondents, and the case was argued before their Lordships Board ex parte.
In 1867 one Bhukhan La
