Chapter V Chapter V

The mortgages executed in favour of, and all other assets transferred to a primary mortgage bank by the members thereof shall, with effect from the date of such execution or transfer, be deemed to have been transferred by such primary mortgage bank to the Central Mortgage Bank.

Where any property mortgaged to the Central Mortgage Bank or a primary mortgage bank is rendered insufficient and the mortgagor, having been given a reasonable opportunity by a Board or the Committee of the primary mortgage bank of providing further security enough to render the whole security sufficient or of repaying such portion of the loan as may be determined by the Board or the Committee, has failed to provide such security or to repay such portion of the loan, the whole of the loan shall be deemed to fall due at once and the Board or the Committee, as the case may be, shall be entitled to take action against the mortgagor under section 8 or section 12 for the recovery thereof. Explanation.—A security is insufficient within the meaning of this section unless the value of the mortgaged property exceeds the amount for the time being due on the mortgage by such proportion as may be specified in the bye-laws of the Central Mortgage Bank or the concerned primary mortgage bank, as the case may be.

(1) The Board or the Trustee may direct the Committee of a primary mortgage bank to take action against a defaulter under section 8, section 12, or section 24 and if the Committee neglects or fails to do so, the Board or the Trustee may take such action. (2) (a) where such action is taken by the Board, the provisions of this Act and of any rules or regulations made thereunder shall apply in respect thereto as if all references to the primary mortgage bank and to its Committee in the said provisions were references to the Central Mortgage Bank and the Board, respectively. (b) where such action is taken by the Trustee, the provisions of this Act and of any rules or regulations made thereunder shall apply in respect thereto as if all references to the primary mortgage bank or to its Committee in the said provisions were references to the Trustee.

Notwithstanding anything contained in the Kerala Compensation for Tenants Improvements Act, 1958, the improvements, if any, made subsequent to the date of the mortgage by a lessee of property mortgaged to the Central Mortgage Bank or a primary mortgage bank, as the case may be, shall be treated as accession to the mortgaged property and shall be available to such Bank for the realisation of the mortgaged amounts.

Notwithstanding anything contained in the Insolvency Act, 1955, a mortgage executed in favour of the Central Mortgage Bank or a primary mortgage bank, as the case may be, shall not be called in question on the ground that it was not executed in good faith for valuable consideration or on the ground that it was executed in order to give such mortgage bank a preference over the other creditors of the mortgagor.

(1) A mortgage executed in favour of the Central Mortgage Bank or a primary mortgage bank, as the case may be, after the commencement of this Act, shall have priority over any claim of the Government arising from a loan under the Land Improvement Loans Act, 1883 (19 of 1883), or the Agriculturists' Loans Act, 1884 (12 of 1884), or the Cochin Agricultural Improvement Loans Act, IV of 1093 or the Travancore Land Improvement and Agricultural Loans Act (Travancore Act IX of 1094), granted after the execution of the mortgage. (2) Notwithstanding any enactment or rule of law, a mortgage executed in favour of the Central Mortgage Bank or a primary mortgage bank, as the case may be, shall take precedence over any attachment or oral mortgage over the properties, where after publication of a notice in the prescribed form, such claim or interest has not been notified to such Bank within the time prescribed in the said notice. (3) The Government may make rules prescribing the form of the notice under this section and the manner of its publication.

Where a mortgage is executed in favour of the Central Mortgage Bank or a primary mortgage bank, as the case may be, for payment of prior debts of the mortgagor, such Bank may, notwithstanding the provisions of sections 83 and 84 of the Transfer of Property Act, 1882 (4 of 1882), by notice in writing, require any person to whom any such debt is due to receive payment of such debt or part thereof from the Bank at its registered office within such period as may be specified in the notice. If any such person fails to receive such notice or such payment, such debt or part thereof, as the case may be, shall cease to carry interest from the expiration of the period specified in the notice, except in cases where such person proves to the satisfaction of the Board or the Committee of the primary mortgage bank, as the case may be, that the failure to receive notice or payment was due to causes beyond his control: Provided that where there is a dispute as regards the amount of any such debt, the person to whom such debt is due shall be bound to receive payment of the amount offered by the Bank towards the debt, but such receipt shall not prejudice the right, if any, of such person to recover the balance claimed by him.

(1) Subject to such restrictions, limitations and conditions as may be prescribed, the Registrar and officers subordinate to the Registrar who are authorised by him in this behalf by general or special order in writing, and such other officials engaged in the relief of rural indebtedness or officers of co-operative banks which are registered or deemed to be registered under the Travancore-Cochin Co-operative Societies Act, 1951, (1) Any of the officers acting under the provisions of this Act or the Madras Co-operative Societies Act, 1932, as the Government may, by notification in the Gazette authorise in this behalf, shall have the same powers as are vested in a court under the Code of Civil Procedure, 1908 (5 of 1908), when trying a suit, in respect of the following matters, namely:-(a) enforcing the attendance of any person and examining him on oath or affirmation; (b) compelling the production of documents; and (c) issuing commissions for the examination of witnesses. (2) Any of the officers authorised by or under sub-section (1) may require any person present before him to furnish any information or to produce any document then and there in his possession or power, relevant to the inquiry. (3) Any officer before whom any document is produced under sub-section (1) or sub-section (2) shall have power to take, or to authorise the taking of, such copies of the document or of any entries therein as such officer or person may consider necessary. Copies so taken shall, when certified in such manner as may be prescribed, be admissible in evidence for any purpose in the same manner and to the same extent as the original document or the entries therein, as the case may be. (4) (a) Any person who wilfully or without reasonable excuse disobeys any summons, requisition or order issued under sub-section (1) or sub-section (2), shall be punishable with fine which may extend to fifty rupees, and in the case of a continuing disobedience with an additional fine which may extend to five rupees for every day during which such disobedience continues after conviction for the last such disobedience. (b) No court inferior to that of a Magistrate of the first class shall try any offence under clause (a). (c) Every offence under clause (a) shall, for the purposes of the Code of Criminal Procedure, 1898 (5 of 1898), be deemed to be non-cognizable. (d) No prosecution shall be instituted under clause (a), without the previous sanction-(i) of the Registrar in case the summons, requisition or order alleged to have been disobeyed was issued by the Registrar or any person subordinate to him or by any officer of a co-operative bank; and (ii) of the Collector of the district in other cases. Such sanction shall not be given without giving the party concerned an opportunity to be heard. (5) The Government shall have power to make rules for giving effect to the provisions of this section.

(1) Notwithstanding anything contained in the Indian Registration Act, 1908 (16 of 1908), it shall not be necessary for any Director, Secretary or other officer of the Central Mortgage Bank or of a primary mortgage bank to appear in person or by agent at any registration office in any proceedings connected with the registration of any instrument executed by him in his official capacity or to sign as provided in section 58 of that Act. (2) Where any instrument is so executed, the registering officer to whom such instrument is presented for registration may, if he thinks fit, refer to such Director, Secretary or Officer for information respecting the same, and, on being satisfied of the execution thereof, shall register the instrument.

Notwithstanding that a mortgage executed in favour of a primary mortgage bank has been transferred, or is deemed under the provisions of section 23 to have been transferred, to the Central Mortgage Bank-(a) all moneys due under the mortgage shall, in the absence of any specific direction to the contrary issued by the Board or the Trustee and communicated to the mortgagor, be payable to the primary mortgage bank and such payment shall be as valid as if the mortgage had not been so transferred; and (b) the primary mortgage bank shall, in the absence of any specific direction to the contrary issued by the Board or the Trustee and communicated to the primary mortgage bank, be entitled to sue on the mortgage or take any other proceedings for the recovery of the moneys due under the mortgage.

(1) Where a mortgage executed in favour of the Central Mortgage Bank or a primary mortgage bank, either before or after the commencement of this Act, is called in question on the ground that it was executed by the manager of a joint Hindu family or the karanavan of a Marumakkathayam tarwad or tavazhi or of a Nambudiri Illom, or the manager of a Thiyya or Ezhava family, or the ejaman or ejamanathi of an Aliyasantana family, for a purpose not binding on the members thereof, whether majors or minors, the burden of proving the same shall, notwithstanding any law to the contrary, be on the party raising it. (2) A mortgage executed in favour of the Central Mortgage Bank or a primary mortgage bank by the manager of a joint Hindu family or the karanavan of a Marumakkathayam tarwad or tavazhi or of a Nambudiri Illom or the manager of a Thiyya or Ezhava family or the ejaman or ejamanathi of an Aliyasantana family shall be binding on the members thereof, whether majors or minors, if the loan secured by the mortgage was granted for any of the following purposes, namely:-(a) the improvement of agricultural land or of the methods of cultivation; and (b) the purchase of land.

Where a tenant mortgages his holding in favour of a primary mortgage bank, the following provisions shall apply so long as the mortgage subsists, notwithstanding anything to the contrary contained in any law relating to tenancy or in any custom or contract-(i) both before and after granting the loan secured by the mortgage, the primary mortgage bank shall give notice in writing to the landlord of the tenant, and if such landlord is himself the tenant of another landlord, also to that landlord, and likewise to every superior landlord from whom interest in the holding is derived, up to and including the landowner; (ii) every landlord to whom notice is given under clause (i) shall give not less than fifteen days' notice in writing to the primary mortgage bank before instituting a suit for bringing the holding of his tenant (whether such tenant be the mortgagor or a superior landlord) to sale for default in payment of rent or michavaram or jenmikaram or for evicting such tenant from the holding; (iii) the tenant who has mortgaged the holding to the primary mortgage bank shall not except with the previous permission of the Bank, surrender his holding or any part thereof to his landlord or deal with it in any other manner, and no such transaction entered into by the tenant without such permission shall affect in any way the interest of the Bank in the holding; (iv) in a suit for eviction instituted against the tenant who has mortgaged the holding to the primary mortgage bank, the Bank shall, on application to the court in which the suit is instituted, be entitled to be paid out of the amount of compensation, if any, deposited in court under section 5 of the Kerala Compensation for Tenants Improvements Act, 1958, the moneys due to the Bank under the mortgage; (v) if, on the expiry of the tenancy of the tenant who has mortgaged the holding to the primary mortgage bank, the tenant does not renew the tenancy, the Bank shall be entitled to obtain a renewal of the tenancy on behalf of the tenant and any renewal fee paid by the Bank shall be added to the principal money due under the mortgage; (vi) if the tenant who has mortgaged the holding to the primary mortgage bank makes default in the payment of any rent or michavaram or jenmikaram due to his landlord or the Government, as the case may be, the Bank shall be entitled to pay the same to the landlord or the Government and the amount so paid shall be added to the principal money due under the mortgage. Explanation.-In so far as the rent or michavaram is payable in kind, the primary mortgage bank shall have the right to pay the value thereof calculated at the rate or rates notified by the Government from time to time in the Gazette; (vii) where the primary mortgage bank pays any renewal fee, rent, michavaram or jenmikaram under clause (v) or clause (vi), it shall be entitled to regard the whole of the mortgage money as having become payable and, after giving a reasonable opportunity to the tenant to repay the whole of the said money or such portion thereof as may be determined by the Bank, to bring the holding to sale under the provisions of Chapter IV of this Act.

The Central Mortgage Bank or any primary mortgage bank may grant copies of any document obtained and kept by it in the course of its business or of any entries in such documents; and any copy so granted shall, when certified in such manner as may be prescribed, be admissible in evidence for any purpose in the same manner and to the same extent as the original document, or the entries therein, as the case may be.

The provisions of Chapters III and IV shall apply also to loans advanced by primary mortgage banks from funds which have not been borrowed from the Central Mortgage Bank and loans taken over by the Central Mortgage Bank from the Travancore Credit Bank.

Whenever under the provisions of this Act, notice is required to be given to any person in writing, it shall be sufficient to send such notice by registered post.

The provisions of sections 102 and 103 of the Transfer of Property Act, 1882 (4 of 1882), and of any rules made by the High Court under section 104 of that Act, for carrying out the purposes of the said sections, shall apply, so far as may be, in respect of all notices to be served under this Act.

At any sale of movable or immovable property held under the provisions of this Act in order to recover any money due to the Central Mortgage Bank or any primary mortgage bank, no Director, Secretary or other officer of the Central Mortgage Bank or such

The Board may, if it thinks fit, delegate all or any of its powers under sections 12, 19 and 25 to any executive committee constituted by it and consisting of two or more of its members.

The Board may, from time to time, with the previous sanction of the Registrar, start branches of the Central Mortgage Bank at such convenient centres as may be decided upon and carry on operations through them.

Notwithstanding anything contained in the Travancore-Cochin Co-operative Societies Act, 1951, or the Madras Co-operative Societies Act, 1932 or the rules made under the said Acts, the Board shall have general power of supervision over the primary mortgage banks and may make regulations not inconsistent with this Act or the rules made thereunder— (a) for the inspection of the account books and proceedings of primary mortgage banks; (b) for the submission of returns and reports by primary mortgage banks in respect of their transactions; (c) for the periodical settlement of accounts between primary mortgage banks and the Central Mortgage Bank and for the payment of the amounts recovered by primary mortgage banks on mortgages transferred, or deemed under the provisions of section 23 to have been transferred, to the Central Mortgage Bank; (d) prescribing the form in which applications to primary mortgage banks for loans should be made and for the valuation of the properties offered as security for such loans; (e) for the investment of moneys realised from the mortgagors; and (f) generally for the purpose of safeguarding the interest of the parties concerned and for carrying out the purposes of this Act.

Notwithstanding anything contained in this Act, all assets, rights and liabilities of the Cochin Co-operative Land Mortgage Bank, Limited, subsisting at the commencement of this Act shall continue to be the assets, rights and liabilities of the said Bank and the provisions of the Cochin Co-operative Land Mortgage Bank Act, XXV of 1111, shall apply with respect to such assets, rights and liabilities.

The Madras Co-operative Land Mortgage Banks Act, 1934, as in force in Malabar and, subject to the provisions of section 43, the Cochin Co-operative Land Mortgage Bank Act, XXV of 1111, are hereby repealed.