Chapter IV Chapter IV

(1) Notwithstanding anything contained in the Transfer of Property Act, 1882 (4 of 1882), where a power of sale without the intervention of the court is expressly conferred on the Central Mortgage Bank or a primary mortgage bank, by the mortgage deed, the Board or the Committee of such primary mortgage bank, or any person authorised by the Board or such Committee, as the case may be shall, in case of default of payment of the mortgage money or any part thereof have power, in addition to any other remedy available to them, to bring the mortgaged property to sale without the intervention of the court. (2) No such power shall be exercised unless- (a) the Board or such Committee has given an opportunity to the mortgagor or mortgagors to show cause why the property may not be sold without the intervention of court; (b) notice in writing requiring payment of such mortgage money or part thereof has been served upon- (i) the mortgagor or each of the mortgagors; (ii) any person who has any interest in or charge upon the property mortgaged or in or upon the right to redeem the same; (iii) any surety for the payment of the mortgage debt or any part thereof; and (iv) any creditor of the mortgagor, who has in a suit for the administration of his estate obtained a decree for sale of the mortgaged property; and (c) default has been made in payment of such mortgage money or part thereof for three months after such service: Provided that the obligation to give such notice under sub-clauses (ii) and (iv) of clause (b) shall be confined to cases where the Board or the Committee has notice of such claims: Provided further that where a mortgage has been executed by the members of a marumakkathayam Tarwad or Nambudiri Illom or Aliyasantana family, it shall be necessary to send notice under this sub-section only to the three seniormost members thereof.

(1) For exercising the power of sale conferred by section 12, the Board or the Committee or any other person duly authorised by the Board or such Committee, as the case may be, may apply to the sale officer appointed in that behalf under section 21 to sell the mortgaged property or any part thereof and such officer shall, after giving notice in writing to all the persons referred to in section 12, sell such property in the manner prescribed. (2) The sale shall be by public auction and shall be held in the village where the mortgaged property is situate or at the nearest place of public resort if the sale officer is of opinion that the property is likely to sell to better advantage there.

(1) When a mortgaged property has been sold under this Chapter, the mortgagor or any person having a right or interest therein affected by the sale, may, at any time within thirty days from the date of sale, apply to the Board or the Committee of the primary mortgage bank concerned, as the case may be, to have the sale set aside on his depositing at the office of the concerned bank- (a) for payment to the Central Mortgage Bank or the primary mortgage bank, as the case may be, the amount specified in the proclamation of sale together with subsequent interest and the costs, if any, incurred by the bank in bringing the property to sale; and (b) for payment to the purchaser a sum equal to five per cent of the purchase money. (2) If such deposit is made, the Board or the Committee, as the case may be, may in its discretion, make an order setting aside the sale. (3) Where no application is made under sub-section (1) or where such application is made and disallowed, the Board or the Committee, as the case may be, shall apply to the Registrar or any other officer empowered by the Government in this regard to make an order confirming the sale and, on the Registrar or such officer confirming the sale, it shall become absolute and the property shall be deemed to have vested in the purchaser from the time when the property is sold.

(1) The proceeds of every sale under this Chapter shall be applied by the sale officer, first in payment of all costs, charges and expenses properly incurred by him as incidental to the sale or any attempted sale; secondly, in payment of all interest due on account of the mortgage in consequence whereof the mortgaged property was sold, thirdly, in payment of the principal money due on account of the mortgage; and lastly, the residue, if any, shall be paid to the person proving himself interested in the property sold or, if there are more such persons than one, then to such persons, according to their respective interest therein or upon their joint receipt. (2) (a) Any person dissatisfied with the decision of the sale officer in regard to the distribution of such residue may, within thirty days of the communication to him of such decision, institute a suit in a court to establish the right he claims. (b) The sale officer shall not distribute such residue until thirty days have elapsed from the communication of his decision to all the persons concerned, or, if a suit has been instituted within the said period of thirty days by any such person and due notice thereof is given to him before the payment, until the suit is disposed of or otherwise than in accordance with the decision of the court thereon. (3) Any deficit occurring after the sale of the mortgaged land may also be recovered in the manner provided in this Chapter from any other assets of the mortgagor. Explanation.-In this section and in section 17 "court" means the civil court having jurisdiction to entertain a suit to enforce the mortgage and within the limits of whose jurisdiction the property sold is situate.

Where a sale of mortgaged property has become absolute, the sale officer shall grant a certificate specifying the property sold and the name of the

(1) Where the mortgaged property sold is in the occupancy of the mortgagor or of some person on his behalf or of some person claiming under a title, other than a lease, created by the mortgagor subsequent to the mortgage in favour of the Central Mortgage Bank or primary mortgage bank, as the case may be, and a certificate in respect thereof has been granted under section 16, the court shall, on the application of the purchaser, order delivery to be made by putting such purchaser or any person whom he may appoint to receive delivery on his behalf, in possession of the property. (2) Where the property sold is in the occupancy of a tenant or other person entitled to occupy the same and a certificate in respect thereof has been granted under section 16, the court shall, on the application of the purchaser, and after giving notice to such tenant or other person, order delivery to be made by affixing a copy of the certificate of sale in some conspicuous place in the property and proclaiming to the occupant by beat of drum or other customary mode at some convenient place that the interest of the mortgagor has been transferred to the purchaser. (3) The provisions of rules 97 to 103 of Order XXI of the First Schedule to the Code of Civil Procedure, 1908 (5 of 1908), shall mutatis mutandis, apply to the cases dealt with in sub-sections (1) and (2).

It shall be competent to the Central Mortgage Bank or a primary mortgage bank to purchase the mortgaged property sold under this Chapter, but the property so purchased shall be disposed of by such bank by sale within such period as may be fixed by the Trustee.

(1) The Board may on its own motion or on the application of any branch of the Central Mortgage Bank or the Committee of a primary mortgage bank under circumstances in which the power of sale conferred by section 12 may be exercised, appoint in writing a receiver of the produce and income of the mortgaged property or any part thereof and such receiver shall be entitled either to take possession of the property or collect its produce and income, as the case may be, to retain out of any money realised by him, his expenses of management including his remuneration, if any, as may be fixed by the Board and to apply the balance in accordance with the provisions of sub-section (8) of section 69-A of the Transfer of Property Act, 1882 (4 of 1882). (2) A receiver appointed under sub-section (1) may, for sufficient cause and on application made by the mortgagor, be removed by the Board. (3) A vacancy in the office of the receiver may be filled up by the Board. (4) Nothing in this section shall empower the Board to appoint a receiver where the mortgaged property is already in the possession of a receiver appointed by a civil court; but the Board or the Committee of a primary mortgage bank, as the case may be, may, through the Secretary of the Central Mortgage Bank or the primary mortgage bank, as the case may be, petition to such court to direct the receiver of such court to apply any part or the whole of the surplus remaining in his hands after meeting the expenses of his management to the discharge of the mortgage amount or part thereof, as the case may be.

When a sale has been made in the professed exercise of a power of sale under section 12 and has been confirmed under sub-section (3) of section 14, the title of the purchaser shall not be impeachable on the ground that no case had arisen to authorise 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 Central Mortgage Bank or the concerned primary mortgage bank, as the case may be.

The Registrar may appoint sale officers for the purpose of conducting sales under this Chapter.

The Government may make rules not inconsistent with this Chapter— (1) for the due proclamation and conduct of the sale; (2) for the recovery of the expenses of proclamation and sale; (3) for the deposit of the purchase money; (4) for the resale of the property, if the purchase money is not deposited; (5) for the registration of claims in respect of properties mortgaged to the Central Mortgage Bank or a primary mortgage bank; and (6) generally for carrying out the provisions of this Chapter.