On 29th July, a bench of Delhi High Court consisting of Justice Anu Malhotra, while hearing the validity of a mortgage in a case held that a simple mortgage can be created by handing over the documents of the property to the mortgagor but in case since the original documents of the property which were handed over cannot be not established through the record then in such case e aspect of creation of any kind of mortgage cannot be sustained.
Facts of the case:
As per the record, the plaintiff i.e. the appellant herein had contended that in the year 2005, the defendants were in financial hardship and approached him for a loan of Rs.1,03,000/- which the plaintiff advanced to the defendants in two instalments of Rs.76,000 and Rs.27,000 and the defendants are alleged to have executed an agreement in favour of the plaintiff on 21.07.2005 that they would return the loan within 11 months and that if the defendants failed to return the loan the defendant no.1 would mortgage the first floor of the house no.C-1/306, Nand Nagri, Delhi in favour of the plaintiff for a sum of Rs.1,03,000/- However the defendant as claimed by the plaintiff failed to make the payment and further tried to sub let the apartment.
The learned trial Court vide its impugned judgment had thus held that the evidence that had been led by the plaintiff was contrary to the pleadings of the case in as much as whereas according to the claims of the plaintiff.
Contention of the plaintiff:
The following contention has been submitted by the plaintiff/Appellant:
- It was submitted by the plaintiff that he apprehended that after 22.02.2007 the defendant no.1 had transferred the first floor of the said house to some stranger without the consent and permission of the plaintiff and that the defendant no.1 was not ready and willing to return the sum of Rs.1,03,000/- to the plaintiff nor was the defendant no.1 ready and willing to hand over possession of the first floor of the house to the plaintiff.
- The plaintiff had further submitted to the effect that in para 11 of the mortgage deed dated 22.02.2007 it had clearly been mentioned that the original allotment slip of the property was handed over to the plaintiff by the defendants which was misplaced by him.
- The plaintiff contended that the mortgage of the first floor of the house was a simple mortgage under section 58(b) of the Transfer of Property Act, 1882 as the original allotment slip of the property was handed over to the plaintiff by the defendant no.1.
Observation and judgement of the court:
The Hon’ble bench of the court made the following observation:
- The analysis of the pleadings and the evidence on the record of the learned trial Court by the learned trial Court vide the impugned judgment dated 30.06.2015 brings forth that the documents of the property allegedly handed over by the defendant no.1 on 21.07.2005 to the plaintiff, were not even specified in the mortgage deed dated 22.02.2007.
- Furthermore, the original allotment slip stated to have been given by the defendant no.1 to the plaintiff at the time of execution of the alleged mortgage deed dated 22.02.2007 has also not been produced and is stated to have been misplaced.
- The documents of the properties allegedly given by the defendant no.1 to the plaintiff at the time of execution of the mortgage deed dated 22.02.2007 is not spelt out in the said mortgage deed.
Based on the above, the court held that the contention of the plaintiff that an equitable mortgage was created by the deposit of the title document of the property in question i.e. the deposit of the original allotment letter (issued by the DDA) in favour of the husband of the defendant no.1, cannot be accepted as rightly held vide the impugned judgment of the learned trial Court.
The court further stated that undoubtedly a simple mortgage can be created by handing over the documents of the property to the mortgagor but in the instant case, that the original documents of the property were handed over to the plaintiff is not established through the record. Thus, it was held that was no infirmity in the judgments of the learned trial Court dated 30.06.2015 nor of the Court of the learned ADJ dated 26.09.2016 in relation to the aspect of creation of any kind of mortgage whatsoever in favour of the plaintiff by the defendant no.1.
The appeal was therefore dismissed.
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