Mortgage
S. Fernandes
(Querist) 23 November 2014
This query is : Resolved
Dear Sirs,
A private ltd company has purchased a property. The sale deed is dated 12.02.1012.
The sale deed reflects a purchase price of Rs. 55 lakhs.
On same date as sale deed, ie. 12,02.2012, said Company has taken a loan of Rs. 1 cr. from nationalized bank, by deposit of title deed.
Bank has revalued the property through government approved valuer, to be 4,5 cr. on date of sale deed and sanctioned the loan.
Company has then registered this charge of 1 Cr. at the registrar of companies, under companies act 1932.
Questions:
1. Can mortgage by deposit of title deed be created in this instance where title deed reflects about half the value of loan amount.
OR
Must such mortgage of property declared as being less than the loan amount require a separate mortgage deed which must be registered, especially since the loan is sanctioned based on the valuers document declaring the market value of the property and not the value on sale deed.
2. Does registration of charge at the registrar of companies amount to registration required under Sec-17 of the registration Act..
Thanking you.
KUMAR JAGADEESAN
(Expert) 23 November 2014
Dear Mr.Fernandes
The registration value of sale deed has nothing to do with the Bank Loan since the Banks sanction loan based on the market value of the property as assessed by the Bank approved valuer. No need for creation of mortgage deed since EM is created by deposit of title deeds.
Charge registration under Companies Act is different from Registration under Registration Act.
J.Kumar
Advocate
Hyderabad
