Certified copy of title deed cannot be taken as of right as title deed.

M. Thanikachalam, J.

This is a suit for recovery of a sum of Rs.1,98,486.07 with subsequent interest thereon, against defendants 1 & 3 as well as for a preliminary decree, on the basis of the mortgage by deposit of title deed.

2. Brief facts leading to the claim:

(a) The plaintiff granted to the first defendant financial accommodation for the purpose of his business by way of cash credit facility, fixing the maximum limit of Rs.50,000/-. The first defendant as collateral security deposited certified copy of title deed relating to the property described in Schedule 'A' to the plaint with the plaintiff s branch on 24.9.1986, with an intention to create an equitable mortgage. Subsequently on 12.11.1987, by submitting an affidavit, the first defendant confirmed that the original document was lost, certified copy alone was deposited.

(b) Pursuant to the financial accommodation, the plaintiff lent and advanced money to the first defendant and the first defendant also then and there, not only acknowledged his liability, but also executed a promissory note on 12.1.1990 for Rs. 81,737.82, agreeing to repay the said amount with interest thereon, as and when demanded. Later, on 12.1.1990, he had also hypothecated the stock-in-trade stored at the business premises, which is described in Schedule 'B' to the plaint, in addition, hypothecating the machineries also described in Schedule 'C' to the plaint. Despite repeated demands, the first defendant failed to pay the amount.

(c) On verification, it is found that defendants 2 & 3 have purchased the mortgaged immovable property in the year 1984, and on 12.11.1987, which were not disclosed by the first defendant, while creating equitable mortgage. Hence defendants 2 & 3 are impleaded as necessary parties, since they are interested in hypothecation. Hence the suit for recovery of the amount, as stated above.

3. The second defendant's case in brief:

The suit filed by the plaintiff, without obtaining leave to file the suit, is liable to be dismissed, since the suit ought to have been filed, at the place, where the immovable property situate. This defendant had purchased an extent of 0. 45 cents comprised in Survey No. 170/8 from the first defendant on 20.8.1984, even before the alleged date of equitable mortgage. Therefore, the suit filed against this defendant, including the extent purchased by him, is not maintainable. The plaintiff ought to have obtained a regular mortgage deed, for the amount advanced to the first defendant, since the deposited certified copy of the title deed to the 'A' Schedule property, will not amount to creation of mortgage by deposit of title deed. Therefore, the alleged mortgage is invalid and this defendant or the property purchased by him, are not responsible or liable for the money said to have been advanced to the first defendant. Hence it is prayed, the suit may be dismissed with costs.

4. The third defendant's case in brief.

As contemplated under Section 16 of the Civil Procedure Code, the plaintiff ought to have instituted the suit at the place, where the immovable property situate, not before this Court, that too, without obtaining leave to file the suit. The transactions between the plaintiff and the first defendant are not within the knowledge of this defendant. This defendant is a bonafide purchaser of the agricultural land, an extent of 1. 28 acres from the first defendant for a valuable consideration on 16.6.1987. Pursuant to the said sale, patta was also issued in favour of this defendant. When this defendant had purchased the property, he insisted the first defendant, to produce the original title deed, for which the first defendant answered, that he had lost the same some years ago and it could not be traced out. Thereafter, verifying the encumbrance certificate pertaining to the suit land, and unable to find any encumbrance regarding the suit mortgage, this defendant had purchased the property without the knowledge and notice of any prior encumbrance