The main legal point established in the judgment is the requirement of a registered instrument for the transfer of mortgages as immoveable property under the Transfer of Property Act, and the distinction between gifts of moveable and immoveable property.

John Wallis, C.J.

1. This case raised questions of some importance under the Transfer of Property Act as to the transfer of mortgages and of actionable claims by way of gift, and we have taken time to consider our judgment.

2. The facts may be very briefly stated. A few days before his death one Pothi Naicker executed Exhibit-50, an unregistered instrument by which he made an immediate disposition of property consisting of mortgages, promissory notes, and book-debts allotting the items in Schedule I to the defendants, the sons of a deceased son, and the items in Schedule 2 to the plaintiff, the daughter and only surviving child of another deceased son. It is not disputed that this disposition in the deed was intended to take effect at once. Exhibit 50 recites this, and is borne out by the oral evidence of the plaintiffs mother, the 1st witness for the defence in Original Suit No. 26 of 1917 which was tried along with the present suit, that the promissory notes and mortgage deeds mentioned in the second schedule were delivered to her on the plaintiffs behalf when Exhibit 50 was executed. The outstandings or "balances under account" are assigned by the terms of Exhibit So but it does not appear that anything" was handed over to the plaintiffs mother in respect of such outstandings.

3. Section 123 of the Transfer of Property Act requires gifts of immoveable property to be made by registered instrument and the first question is whether the gifts of the mortgages are to be regarded as gifts of immoveable or of moveable property. Under the Act as originally passed mortgage debts were held to be actionable claims, and on this view the effect of Section 8 was that on the transfer of the mortagee debt the securities passed with it. That this was the intention of the legislature in my opinion admits of no doubt, first because, the language of the section is wide enough to cover such securities and it is inconceivable that it would have used such general language if it had not intended to include landed securities the most important class of all; secondly, because Section 8 occurs in Chapter II which deals with the general rules applicable to all classes of property, and is in the first part of that chapter which is headed " A transfer of Property whether moveable or immoveable "; and thirdly, because the section reproduces the rule of English Law that even as regards mortgages the security passed with the principal debt. In Martin v. Mowlin (1760) 2 Burr 979 Lord Mansfield expressed himself as though the legal estate in the land passed to the transferee of the mortgage debt, but in Duffield v. Elwes (1827) 1 Blgh N.S. 497, 541 Lord Eldon pointed out that this language was not strictly accurate and that what happened was that equity treated the mortgagee making the transfer as a trustee of the land for the transferee of the mortgage debt. The Indian Legislature would seem to have decided to enact the rule in India in the form in which it was expressed by Lord Mansfield. Under the Act as originally passed mortgage debts were assignable as actionable claims, and the assignment of the debt in my opinion passed the security with it under Section 8. This was the view taken by this Court in Subramaniam v. Perumal Reddi (1895) I.L.R. 18 Mad. 454 : 5 M.L.J. 92 and I think it was right.

4. The. Legislature however subsequently became dissatisfied with the state of the law, and in 1900 amended the act by substituting a new chapter as to actionable claims, and inserting in Section 3 a definition of " actionable claim" which excluded any " debt secured by mortgage of moveable property." The effect of this amendment was that mortgage debts could no longer be transferred as actionable claims under Chapter VIII. The mortgagees interest in the land had all along been transferable as immoveable property by way of sale exchange and gift under chapters IV," VI and VII and had carried with it the mortgage debt, and I think that the intention of the legi