D.Dis.No.10057/P1/2020, Simple Mortgage Revision Order
The Chief Controlling Revenue Authority and Inspector General of Registration, Chennai, issued D.Dis.No.10057/P1/2020 dated 22 August 2024, allowing a revision petition concerning Document No. P.15/2015 registered at the Sub Registrar Office, Ganapathy. It set aside the District Registrar, Coimbatore order demanding deficit stamp duty and penalty, and classified the deed only as a mortgage without possession under Article 40(b) of the Indian Stamp Act, 1899.
What the decision covers
D.Dis.No.10057/P1/2020 dated 22 August 2024 concerns a deed titled “Deed of Simple Mortgage (Without Possession)”, executed on 27 March 2015 by Mr. V.S.J. Dinakaran in favour of M/s. Religare Finvest Ltd. The deed, Document No. P.15/2015 at the Sub Registrar Office, Ganapathy, secured a loan of Rs.7,55,36,323 and bore stamp duty of Rs.40,000.
The Sub Registrar impounded the document because its clauses allowed the mortgagee, following default, to take possession and sell or arrange the sale of the property without court intervention.
District Registrar’s classification
The District Registrar, Coimbatore treated the deed as covering two distinct matters:
- A mortgage without possession under Article 40(b) of the Indian Stamp Act, 1899.
- A power of attorney to sell immovable property granted for consideration under Article 48(e).
- Deficit stamp duty of Rs.30,21,453 and a penalty of Rs.1,547 were determined.
The District Registrar considered that the mortgagee had been given authority to act for the mortgagor and execute a deed, including a sale deed.
Revision decision
Mr. V.S.J. Dinakaran challenged the District Registrar’s decision under section 56(1) of the Indian Stamp Act, 1899. He argued that possession remained with the mortgagor and that the mortgagee could take possession or enforce a sale only if the borrower defaulted.
The Chief Controlling Revenue Authority and Inspector General of Registration found that the power to take possession and sell arose only on default. Relying on an earlier decision concerning a similar document, the authority concluded that the sale powers were not absolute and final.
The resulting findings were:
- Document No. P.15/2015 is classifiable only as a mortgage without possession under Article 40(b).
- The document is not additionally classifiable as a power of attorney for consideration under Article 48(e).
- The District Registrar, Coimbatore order dated 7 February 2020 was set aside.
- The revision petition dated 10 March 2020 was allowed.
Who is directly affected
D.Dis.No.10057/P1/2020 directly affects the mortgagor, Mr. V.S.J. Dinakaran, the mortgagee, M/s. Religare Finvest Ltd., and the registration authorities handling Document No. P.15/2015.
This summary is generated from the source document to help you find what is relevant. The PDF above is authoritative. For advice on your own property, use LandLens One or speak to a qualified professional.
Common questions
Was the mortgagee given possession when the deed was executed?
No. The deed stated that possession would remain with the mortgagor. The mortgagee could take possession only if a default occurred.
Why did the District Registrar demand additional stamp duty?
The District Registrar treated the deed as both a mortgage without possession and a power of attorney to sell immovable property for consideration. This resulted in a determination of Rs.30,21,453 as deficit stamp duty and Rs.1,547 as penalty.
What was the final classification of Document No. P.15/2015?
The Chief Controlling Revenue Authority and Inspector General of Registration classified it only as a mortgage without possession under Article 40(b) of the Indian Stamp Act, 1899.
Why was the default sale clause not treated as a separate power of attorney?
The authority found that the mortgagee’s power to take possession and sell applied only after default. Because those powers were not absolute and final, the deed was not additionally classified under Article 48(e).
