Is a mortgage document required to be registered?

A Mortgage by deposit of title deeds does not require any writing. There are three requisites of the mortgage by deposit of title deeds. Those are:

  1. a debt
  2. a deposit of title deeds and
  3. an intention that the deeds shall be security for the debt.

As such a mortgage by deposit of title deeds being an oral transaction is not affected by the law of registration. But although not required by law, as per the practice, if the deposit is accompanied by a memorandum in writing and the writing constitutes a contract between the parties so that it creates a mortgage, it has to be registered. With the result, the oral evidence to contradict it is not admissible. But registration is not necessary, if the mortgage transaction is complete without the writing and the writing is merely a unilateral statement that the mortgage has been effected or a statement of facts from which the contract of mortgage could be inferred. As decided by the Supreme Court in Union Bank of India vs. Lekharam & Company, 1965 2SCJ 91, “the crucial question is: did the parties intend to reduce the bargain regarding the deposit of title deeds to the form of a document? If so, the document requires registration.”

The last and the sixth type of mortgage is known as “anomalous mortgage”. When a transaction is that of mortgage, but it does not fall within any of the foregoing five categories, it is called “anomalous mortgage”. Such mortgages assume many forms moulded by custom or the dictates and stipulations of the creditor who generally has a dominating position. They can be further classified as:-

  1. combinatory i.e. a combination of two or more of the other five types
  2. customary i.e. local mortgages and
  3. miscellaneous.

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