WEEK 5: CHARGE

SYNOPSIS:

introduction

Charge on property.......case laws

In case of charge property is made security but no interest is transferred (AIR 937 OUDH.217)

PLD1971SC318(P.323)

Charge on future property.AIR1953 BOM.101

Charge created both by act of parties and by operation of law

All provisions relating to simple mortggae shall apply to charge.

 

 

100. Charges. Where immovable property of one person by act of parties or operation of law made security for the payment of money to another, and the transaction does not amount to a mortgage, the latter person is said to have a charge on the property; and all the provisions hereinbefore contained [which apply to a simple mortgage shall, so far as may be, apply to such charge]. Nothing in this section applies to the charge of a trustee on the trust-property for expenses properly incurred in the execution of his trust [and, save as otherwise expressly provided by any law for the time being in force, no charge shall be enforced against any property in the hands of a person to whom such property has been transferred for consideration and without notice of the charge].

101. No merger in case of subsequent encumbrance. Any mortgagee of, or person having a charge upon, immovable property, or any transferee from such mortgagee or charge-holder, may purchase or otherwise acquire the rights in the property of the mortgagor or owner, as the case may be, without thereby causing the mortgage or charge to be merged as between himself and any subsequent mortgagee of, or person having charge upon, the same property; and no such subsequent mortgagee or charge-holder shall be entitled to foreclose or sell such property without redeeming the prior mortgage or charge, or otherwise than subject thereto.

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