Section 68 in The Transfer of Property Act, 1882
Title: Right to sue for mortgage-money.
1[68. Right to sue for mortgage-money.-- (1) The mortgagee has a right to sue for the mortgagemoney in the following cases and no others, namely:--
(a) where the mortgagor binds himself to repay the same;
(b) where, by any cause other than the wrongful act or default of the mortgagor or mortgagee, the mortgaged property is wholly or partially destroyed or the security is rendered insufficient within the meaning of section 66, and the mortgagee has given the mortgagor a reasonable opportunity of providing further security enough to render the whole security sufficient, and the mortgagor has failed to do so;
(c) where the mortgagee is deprived of the whole or part of his security by or in consequence of the wrongful act or default of the mortgagor;
(d) where, the mortgagee being entitled to possession of the mortgaged property, the mortgagor fails to deliver the same to him, or to secure the possession thereof to him without disturbance by the mortgagor or any person claiming under a title superior to that of the mortgagor:
Provided that, in the case referred to in clause (a), a transferee from the mortgagor or from his legal representative shall not be liable to be sued for, the mortgage-money.
(2) Where a suit is brought under clause (a) or clause (b) of sub-section (1), the Court may, at its discretion, stay the suit and all proceedings therein, notwithstanding any contract to the contrary, until the mortgagee has exhausted all his available remedies against the mortgaged property or what remains of it, unless the mortgagee abandons his security and, if necessary, re-transfers the mortgaged property.]
1. Subs. by s. 33, ibid., for section 68.
Title: Power of sale when valid.
1[(1)] 2[3*** a mortgatee, or any person acting on his behalf, shall, subject to the provisions of this section, have power to sell or ,concur in selling the mortgaged property, or any part thereof, in default of payment of the mortgage -money, without the intervention of the Court, in the following cases and in no others, namely:--]
(a) where the mortgage is an English mortgage, and neither the mortgagor nor the mortgagee is a Hindu, Muhammadan or Buddhist 4[or a member of any other race, sect, tribe or class from time to time specified in this behalf by 5[the State Government], in the Official Gazette;
(b) where 6[a power of sale without the intervention of the Court is expressly conferred on the mortgagee by the mortgage-deed, and] the mortgagee is 7[the Government];
(c) where 6[a power of sale without the intervention of the Court is expressly conferred on the mortgagee by the mortgage-deed, and] the mortgaged property or any part thereof 8[was, on the date of the execution of the mortgage -deed], situate within the towns of Calcutta, Madras, Bombay, 9[*** 10[or in any other town or area which the State Government may, by notification in the Official Gazette, specify' in this behalf.]
11[(2)] 12*** No such power shall be exercised unless and until—
13[(a)] notice in writing requiring payment of the principal money has been served on the mortgagor, or, one of several mortgagors, and default has been made in payment of the principal money, or of part thereof, for three months after such service; or
14[(b)] some interest under the mortgage amounting at least to five hundred repees is in arrear and unpaid for three months after becoming due.
15[(3)] When a sale has been made in professed exercise of such a power, the title of the purchaser shall not be impeachable on the ground that no case had arisen to authorize the sale, or that due notice was not given, or that the power was otherwise improperly or irregularly 'exercised; but any person damnified by an unauthorised, or improper, or irregular' exercise of the power shall have his remedy in damages against the person exercising the power.
16[(4)] The money which is received by the mortgagee, arising from the sale, after discharge of prior incumbrances, if any, to which the sale is not made subject, or after payment into Court under section 57 of a sum to meet any prior incumbrance, shall, in the absence of a contract to the contrary, be held by him in trust to be applied by him, first, in payment of all costs, charges and expenses properly incurred by him as incident to the sale or any attempted sale; and, secondly, discharge of the mortgage-money and costs and other money, if any, due under the mortgage; and the residue of the money so received shall be paid to the person entitled to the mortgaged property, or authorised to give receipts for the proceeds of the sale thereof.
17[(5)] Nothing in this section or in section 69A applies to powers conferred before the first day of July, 1882.]
18* * * * *
1. Section 69 numbered as sub-section (1) of that section by Act 20 of 1929, s. 34.
2. Subs. by s. 34, ibid., for certain words.
3. The words Notwithstanding anything contained in the Trustees and Mortagees Powers act, 1899 (28 of 1866) omitted by Act 48 of 1952, s. 3 and the Second Schedule.
4. Ins. by Act 3 of 1885, s. 5.
5. The words the L.G., with the previous sanction of the G. G. in C. successively adapted by the A.O. 1937 and the A.O. 1950 to read as above.
6. Ins. by Act 20 of 1929, s. 34.
7. The words the Secretary of State for India in Council successively amended by the A.O. 1937 and the A.O. 1950 to read as above.
8. Subs. by Act 20 of 1929, s. 34, for is.
9. The word Karachi omitted by the A.O. 1948.
10. The words or Rangoon have been successively amended by Acts 6 of 1904, 11 of 1915, 20 of 1929, the A.O. 1937 and the A.O. 1950 to read as above.
11. Second paragraph numbered as sub-section (2) by Act 20 of 1929, s. 34.
12. The word 'But omitted by s. 34, ibid.
13. Clause (1) was lettered (a) by s. 34, ibid.
14. Clause (2) was lettered (b) by s. 34, ibid.
15. Third paragraph numbered as sub-section (3) by s. 34, ibid.
16. Fourth paragraph numbered as sub-section (4) by Act 20 of 1929, s. 34.
17. Subs. by s. 34, ibid., for fifth paragraph.
18. The last paragraph of this section omitted by s. 34, ibid.
Title: Appointment of receiver.
1[69A. Appointment of receiver.--(1) A mortgagee having the right to exercise a power of sale under section 69 shall, subject to the provisions of sub-section (2), be entitled to appoint, by writing signed by him or on his behalf, a receiver of the income of the mortgaged property or any part thereof.
(2) Any person who has been named in the mortgage-deed and is willing and able to act as receiver may be appointed by the mortgagee.
If no person has been so named, or if all persons named are unable or unwilling to act, or are dead, the mortgagee may appoint any person to whose appointment the mortgagor agrees; failing such agreement, the mortgagee shall be entitled to apply to the Court for the appointment of a receiver, and any person appointed by the Court shall be deemed to have been duly appointed by the mortgagee
A receiver may at any time be removed by writing signed by or on behalf of the mortgagee and the mortgagor, or by the Court on application made by either party and on due cause shown.
A vacancy in the office of receiver may be filled in accordance with the provisions of this sub-section.
(3) A receiver appointed under the powers conferred by this section shall be deemed to be the agent of the mortgagor; and the mortgagor shall be solely responsible for the receiver's acts or defaults, unless the mortgage-deed otherwise provides or unless such acts or defaults arc due to the improper intervention of the mortgagee.
(4) The receiver shall have power to demand and recover all the income of which he is appointed receiver, by suit, execution or otherwise, in the name either of the mortgagor or of the mortgagee to the full extent of the interest which the mortgagor could dispose of, and to give valid receipts accordingly for the same, and to exercise any powers which may have been delegated to him by the mortgagee in accordance with the provisions of this section.
(5) A person paying money to the receiver shall not be concerned to inquire if the appointment of the receiver was valid or not.
(6) The receiver shall be entitled to retain out of any money received by him, for his remuneration, and in satisfaction of all costs, charges and expenses incurred by him as receiver, a commission at such rate not exceeding five per cent. on the gross amount of all money received as is specified in his appointment, and, if no rate is so specified, then at the rate of five per cent. on that gross amount, or at such other rate as the Court thinks fit to allow, on application made by him for that purpose.
(7) The receiver shall, if so directed in writing by the mortgagee, insure to the extent, if any, to which the mortgagee might have insured, and keep insured against loss or damage by fire, out of the money received by him, the mortgaged property or any part thereof being of an insurable nature.
(8) Subject to the provisions of this act as to the application of insurance money, the receiver shall apply all money received by him as follows, namely:--
(i) in discharge of all rents, taxes, land revenue, rates and outgoings whatever affecting the mortgaged property;
(ii) in keeping down all annual sums or other payments, and the interest on all principal sums, having priority to the mortgage in right whereof he is receiver;
(iii) in payment of his commission, and of the premiums on fire, life or other insurances, if any, properly payable under the mortgage -deed or under this Act, and the cost of executing necessary or proper repairs directed in writing by the mo rtgagee;
(iv) in payment of the interest falling due under the mortgage;
(v) in or towards discharge of the principal money, if so directed in writing by the mortgagee;
and shall pay the residue, if any, of the money received by him to the person who, but for the possession of the receiver, would have been entitled to receive the income of which he is appointed receiver, or who is otherwise entitled to the mortgaged property.
(9) The provisions of sub-section (1) apply only if and as far as a contrary intention is not expressed in the mortgage-deed; and the provisions of sub-sections (3) to (8) inclusive may be varied or extended by the mortgage-deed, and, as so varied or extended, shall, as far as may be, operate in like manner and with all the like incidents, effects and consequences, as if such variations or extensions were contained in the said sub-sections.
(10) Application may be made, without the institution of a suit, to the Court for its opinion, advice or direction on any present question respecting the management or administration of the mortgaged property, other than questions of difficulty or importance not proper in the opinion of the Court for summary disposal. A copy of such application shall be served upon, and the hearing thereof may be attended by, such of the persons interested in the application as the Court may think fit.
The costs of every application under this sub-section shall be in the discretion of the Court.
(11) In this section, "the Court" means the Court which would have jurisdiction in a suit to enforce the mortgage.]
1. Ins. by Act 20 of 1929, s. 35.
Title: Accession to mortgaged property.
If, after the date of a mortgage, any accession is made to the mortgaged property, the mortgagee, in the absence of a contract to the co ntrary, shall, for the purposes of the security, be entitled to such accession.
(a) A mortgages to B a certain field bordering on a river. The field is increased by alluvion. For the purposes of his security, B is entitled to the increase.
(b) A mortgages a certain plot of building land to B and afterwards erects a house on the plot. For the purposes of his security, B is entitled to the house as well as the plot.
Title: Renewal of mortgaged lease.
When the mortgaged property is as lease 1***, and the mortgagor obtains a renewal of the lease, the mortgagee, in the absence of a contract to the contrary, shall, for the purposes of the security, be entitled to the new lease.
1. The words "for a term of years" omitted by Act 20 of 1929, s. 36.