Judgement Appeal (No. 80 of 1937) from a judgment and decree of the High Court in its appellate civil jurisdiction (April 6, 1937), which had reversed a judgment and decree of that Court in its ordinary original civil jurisdiction (May 22, 1936). The question in this appeal was whether a memorandum of agreement, dated August 2, 1924, and made contemporaneously with the deposit of title deeds on the mortgage of certain immovable property in Calcutta, was a document relating to the mortgage transaction of such a nature as to require registration under the provisions of s. 17, sub-s. 1 (b), of the Indian Registration Act (XVI. of 1908), before being admissible in evidence as provided by s. 49 of that Act. It was contended by the mortgagors that the document should have been registered, and that failure to do so rendered the mortgage unenforceable under s. 49 of the Act. For the appellants, the mortgagees, it was contended that, under s. 59 of the Transfer of Property Act (IV. of 1882), an effective mortgage was created by the deposit of the title deeds. The Indian Registration Act, 1908, provides by s. 17, sub-s. 1 " The following documents shall be registered .... "(b) other non-testamentary instruments which purport or "operate to create, declare, assign, limit or extinguish, whether "in present or in future, any right, title, or interest, whether "vested or contingent of the value of one hundred rupees and "upwards, to or in immovable property ; . . . . " By s. 49 "No document required by s. 17 (or by any "provision of the Transfer of Property Act, 1882) to be "registered shall—(a) affect any immovable property comprised therein.....(c) be received as evidence of any transaction affecting such property or conferring such power, unless "it has been registered....." By the proviso to s. 59 of the Transfer of Property Act, 1882 " Nothing in this section shall be deemed to render "invalid mortgages made in the towns of Calcutta .... by "delivery to a creditor or his agent of documents of title to "immovable property with intent to create a security "thereon." The facts and the terms of the memorandum of agreement appear from the judgment of the Judicial Committee. by "delivery to a creditor or his agent of documents of title to "immovable property with intent to create a security "thereon." The facts and the terms of the memorandum of agreement appear from the judgment of the Judicial Committee. The trial judge (Lort-Williams J.) was of opinion that the memorandum was nothing but " a record of what had been "agreed to orally," and was not " a document containing the "bargain made between the parties,” and did not require te bo registered. On appeal the Appellate Court (Costello and Panckridge JJ.) held that the memorandum of agreement was of such a character as called for registration. The appeal is reported at I. L. R. [ 1937] 2 C. 586. 1939. March 13, 14. A. M. Dunne K.C. and J. M. Pringle for the appellants. The question turns on the terms of a document which was executed after a mortgage by deposit of title-deeds had been made by the appellants. It has been held that because this memorandum subsequently executed was not registered the appellants cannot get the benefit of their mortgage. The point is whether the document which has been held not to be admissible in evidence because it was not registered was one which effected a mortgage, or whether it was a mere record of the previous mortgage by deposit of title-deeds. It is submitted that the real effective meaning of the transactions in question was, first, that there was a deposit of title-deeds to secure loans which the appellants made in praesenti and in future, and that that is covered as an effective mortgage under s. 59 of the Transfer of Property Act, No. IV. of 1882, as it stood at the time of the execution of the memorandum of August 2, 1924. Sect. 59 provided that "Nothing in this section shall be deemed to render invalid "mortgages made in the towns of Calcutta .... by delivery "to a creditor or his agent of documents of title to immovable " property with intent to create a. security thereon." Secondly, the memorandum which was afterwards drawn up really dealt only with the matter of the method of carrying out the transaction, with the dates on which the loan was to be made, with interest, etc., and also contained a power of sale. That memorandum, which was not registered, has been held by the High Court in its appellate jurisdiction to be the document creating the mortgage, and as such, to require registration. It is submitted that the document itself was expressly reciting that the mortgage had already been created by the deposit of title-deeds, with the passing of the title under that deposit under the Transfer of Property Act, and the memorandum was merely recording the fact of such a security having been already provided, and was dealing only with the terms on which that security with its right in the appellants so deposited could be enforced. The document does not operate to create any mortgage at all, or to create any right in immovable property. Kedarnath Dutt v. Shamloll Khetlry (( 1873) 11 Beng. L. R. 405, 407, 409, 412.) has always been cited as determining the question raised in this case. In Pranjivandas Mehta v. Chan Ma Phee (( 1916) L. R. 43 I. A. 122.) the written document did accompany the transaction. If the deposit was made as part and parcel of a written agreement it is conceded that the agreement must be looked at. Pranjivandas Mehtas case (( 1916) L. R. 43 I. A. 122.) does not seem to throw any light on the present problem. There was no independent transaction at all in Subramonian v. Lutchman (( 1922) L. R. 50 I. A. 77, 81.) ; the document in that case created the mortgage, and the case has no relevance to the present one. In order that a document should come within the purview of the Registration Act so as to require registration in relation to a transaction of this kind it must be a document which on its face, so far as the deposit is concerned, makes itself a mortgage Obla Sundarachariar v. Narayanna Ayyar. (( 1931) L. R. 58 I. A. 68, 74.) [Reference was also made to Bageshwari Charan Singh v. Jagarnath Kuari. (( 1931) L. R. 58 I. A. 68, 74.) [Reference was also made to Bageshwari Charan Singh v. Jagarnath Kuari. (( 1931) L. R. 59 I. A. 130,136-7.)] In Obla Sundarachariars case (( 1931) L. R. 58 I. A. 68, 74.) it was stated that "No such memorandum can be within the "section unless on its face it embodies such terms, and is "signed and delivered at such time and place and in such "circumstances, as to lead legitimately to the conclusion that, "so far as the deposit is concerned, it constitutes the agreement "between the parties.” In order that it must be registered there must be something in the document which constitutes the mortgage transaction that was not so in the present case. J. M. Pringle followed. It may be that in the ultimate result the matter depends upon the intention of the parties, and that intention must be drawn from the nature of the document which was executed. In Sir Richard Couchs day equitable titles were recognized in India. Sect. 17 of the Indian Registration Act, Act III. of 1877, was the first step taken in India towards the abolition of equitable estates Mullas Indian Registration Act, 2nd ed., p. 73. The position was carried further in 1882 in the Transfer of Property Act, ss. 5, 54. That process of the abolition of equitable titles in India has been upheld, and there is now no distinction there between legal and equitable estates. Although, therefore, the " law as laid down by Sir Richard Couch in Kedarnath Dutt v. Shamloll Khettry (( 1873) 11 Being L. R. 405, 42.) was correct in his day, it has in fact been quoted over and over again long after the law as he stated it had ceased to exist. It is not questioned that those subsequent decisions, on their facts, were correct, but it would appear to be a little unfortunate that Sir Richard Couchs words should have been used to justify such words as constituting the bargain " and so on, that have been used in some of those later judgments. The only test whether a document requires registration is the statutory test. The appellate Hih Court, however, threw overboard altogether the statute, and took their refuge in that one passage of Sir Richard Couch in Kedarnath Dutt v. Shamloll Khettry (( 1873) 11 Beng. The only test whether a document requires registration is the statutory test. The appellate Hih Court, however, threw overboard altogether the statute, and took their refuge in that one passage of Sir Richard Couch in Kedarnath Dutt v. Shamloll Khettry (( 1873) 11 Beng. L. R. 405, 412.) where he said "If this memorandum was of such a nature that it "could be treated as the contract for the mortgage and what "the parties considered to be the only repository and appro priate evidence of their agreement, it would be the instrument "by which the equitable mortgage was created, and would "come within s. 17 of the Registration Act. . . . ." Although correct at that time, that was no longer law. The document here in question does not create the interest; it does not effect the mortgage. [Reference was also made to Gokul Dass v. Eastern Mortgage and Agency Co. (( 1905) I. L. R. 33 C. 410.), and to Esther Isaac v. Martu Mall. (( 1916) 25 Cal. L. J. 160.)] In the latter case it was said (Ibid. 162.) "When there is a deposit of title-deeds independently of it, "the deposit creates the mortgage and the memorandum need "not be registered." It is submitted that that is an accurate statement of the law. Lionel Cohen K.C. and J. M. Parikh for the respondents. Before the Registration Act of 1877 equitable mortgages were recognized as part of the law of India. By the Transfer of Property Act, 1882, that was stopped except as regards one form of equitable mortgage which was preserved by the proviso to s. 59. What is the nature of an equitable mortgage ? —it is that from the fact of the deposit of the title-deeds, coupled with an advance of money, Indian law will imply an agreement to create a charge. That is an implication, but that implication is of this character, that it will only constitute the bargain if the parties themselves have not chosen to reduce that bargain to writing. If they have done so, then the decisions say that it is the document which creates the bargain between the parties. It is submitted that the first document in the present case requires registration. The second document superseded the first because it was the agreement of the parties that it should do so. If they have done so, then the decisions say that it is the document which creates the bargain between the parties. It is submitted that the first document in the present case requires registration. The second document superseded the first because it was the agreement of the parties that it should do so. But even if it did not, the appellants would still be unable to succeed because the first document equally required registration. The transaction had to be looked at as a whole. When it is found that the first document refers to the second one, and provides that the second should be executed, then they should stand or fall together. [Reference was made to Velamakanya Krishnaiya v. Ponnuswami Aiyar (( 1923) I. L. R. 47 M. 398, 400.) and Subramonian v. Lutchman. (( 1922) L. R. 50 I. A. 77, 79.)] If the respondents had merely handed the document over without the title-deeds, it could not have been said that there was a good equitable mortgage, even if it had been registered. It would not have been a valid security unless accompanied by the deposit of the title-deeds. Therefore it necessarily follows that the deposit is an ingredient in the creation of the security, but not the only one. Disregard the documents, and there is no charge, because the deposit was part and parcel of the transaction, which must be looked at as a whole, and it is the transaction as a whole which creates the charge. If the parties have chosen to make the agreement express, then the document by which that has been done must be registered. That is the only way of reconciling the decisions. Where what would have been implied has been reduced to writing, that writing is part of the equitable mortgage. The equitable mortgage necessarily implies an agreement either express or implied. If it is implied or oral, it is not within s. 17 of the Registration Act, because there is nothing to register. But, if it is reduced into writing, that writing is part of the equitable mortgage, and it is a non-testamentary instrument which declares, assigns or limits, etc., the right, title or interest in the property, and oral evidence cannot be adduced on the subject. But, if it is reduced into writing, that writing is part of the equitable mortgage, and it is a non-testamentary instrument which declares, assigns or limits, etc., the right, title or interest in the property, and oral evidence cannot be adduced on the subject. It is submitted that the written instrument becomes the contract of mortgage within the terms of s. 17, sub-s. 1 (b), of the Registration Act, and must be registered. Obla Sundarachariar v. Narayanna Ayyar (L. R. 58 I. A. 68) states principles in support of the respondents contentions. In Subramonian v. Lutchman (L. R. 50 I. A. 77.) the document was contemporaneous. In no case has a document containing as much particularity and as full provisions as in the present case been held not to require registration. The judgment of the High Court in its appellate jurisdiction correctly stated the principles and correctly applied them. Dunne K.C. replied. There is nothing in the Registration Act which requires any registration of the first document at all. It is merely an agreement to enter into a transaction of mortgage ; it is not a document which itself creates an interest in the property. The second document was one which it was agreed should be executed for the purpose of evidencing a deposit of title-deeds as being the mortgage transaction, and the terms and conditions of the actual loan. April 25. The judgment of their Lordships was delivered by Lord Macmillan. The plaintiffs in this suit, now the appellants, seek to enforce a mortgage for the principal sum of Rs. 25,000, with arrears of interest accrued. Their case is that the mortgage was effected by the delivery to them of the documents of title to certain immovable property in Calcutta with intent to create a security thereon. The general law in India under the Transfer of Property Act, 1882, is that a mortgage for a principal sum of Rs. 100 or upwards can be effected only by a registered instrument duly signed and attested, but the validity of mortgages by deposit of title-deeds in Calcutta and certain other places is expressly recognized and saved, doubtless because of the convenience of this form of security in commercial centres (see s. 59 of the Act as it stood at the date of the transaction with which this case is concerned, and now, by amendment, s. 58 (f)). That the title-deeds of the property were deposited by the respondents with the appellants is not disputed, but the appellants were not content to rely only on this deposit. They insisted on the execution by the respondents of a memorandum of agreement "evidencing the said deposit, "and embodying the terms and conditions of the loan." The appellants found upon this memorandum in their plaint, and the respondents in their written statement aver that this memorandum constituted the bargain between them and the appellants, and they maintain that, inasmuch as it was not registered as required by s. 17, sub-s. 1 (b), of the Indian Registration Act, 1908, it is inadmissible in evidence, and the mortgage is consequently unenforceable under s. 49 of that Act. To this the appellants reply that the memorandum did not effect or constitute any transaction between the parties, but merely recorded a transaction already completed ; it therefore did not require registration, not being, in the words of the statute, a non-testamentary instrument purporting or operating "to create, declare, assign, limit or extinguish ". . . . any right, title, or interest, .... to or in immovable "property/ There have been numerous cases, some of which have reached this Board, in which a mortgage, alleged to have been effected by the deposit of title-deeds, has been accompanied by a written document, and in which the question has arisen whether that document was of such a character as to require registration. The decision in each case has turned upon the nature of the document in question. It will be sufficient to refer to one or two of the most recent of these cases. In Obla Sundarachariar v. Narayanna Ayyar (( 1931) L. R. 58 I. A. 68.)the title-deeds of certain properties were handed over as security for a loan along with two written documents—namely, a promissory note for the total advance and a signed memorandum consisting of a list of the title-deeds, prefaced with the names of the parties and these words (( 1931) L. R. 58 I. A. 71.) "As agreed upon in person "I have delivered to you the undermentioned documents as "security." In the view of their Lordships, as expressed by Lord Tomlin, the memorandum was a document which (Ibid. 72-3.) "merely records particulars of deeds the subject of a deposit, ". . . . 72-3.) "merely records particulars of deeds the subject of a deposit, ". . . . It was and remained a list of the documents deposited "and nothing more. It did not embody the terms of the "agreement between the parties." Their Lordships accordingly reached (Ibid. 74-5.) "the conclusion that the memorandum was "not other than a written record of the particulars of deeds "the subject of an agreement constituted in fact by the act of "deposit and the payment of the money, and that it neither "purported nor operated to create or declare any right, title "or interest in the property included in the deeds, with the "result that it did not require registration." With this case that of Subramonian v. Lutchman (( 1922) L. R. 50 I. A. 77.) may be contrasted. There, on the occasion of the deposit of the title-deeds, a memorandum was signed and delivered to the lender or creditor which stated (( 1922) L. R. 50 I. A. 79.) "We hand you herewith title-deeds relating to [certain specified property] .... this please "hold as security against advances made to us." The memorandum in addition referred to a promissory note and a second mortgage over certain other property, both in favour of the borrowers, which they also handed over as security for the advances made to them, and the document concluded (( 1922) L. R. 50 I. A. 79.) "We promise not to deal with same till your amount "due you is fully paid and satisfied." Lord Carson, in delivering their Lordships judgment, quoted passages from the cases of Kedarnath Dutt v. Shamloll Khettry (( 1873) 11 Beng. L. R. 405.) and Pranjivandas Mehta v. Chan Ma Phee (( 1916) L. R. 43 I. A. 122.)plain as laying down the law on the subject and stated the criterion to be (L. R. 50 I. A. 83.) " Did the document .... constitute the bargain "between the parties, or was it merely the record of an already "completed transaction ? constitute the bargain "between the parties, or was it merely the record of an already "completed transaction ? " On the evidence and on the terms of the document their Lordships had no doubt (L. R. 50 I. A. 84.) " that the "memorandum in question was the bargain between the "parties, and that without its production in evidence the "plaintiff could establish no claim, and as it was unregistered "it ought to have been rejected.” Commenting on this passage, Lord Tomlin, in the case above quoted, said on behalf of the Board (L. R. 58 I. A. 74.) " While their "Lordships do not think that the language of Lord Carson "conveys or was intended to convey the meaning that no "memorandum relating to a deposit of title-deeds can be "within s. 17 of the Indian Registration Act unless it embodies "all the particulars of the transactions of which the deposit "forms part, their Lordships are of opinion that no such "memorandum can be within the section unless on its face "it embodies such terms and is signed and delivered at such "time and place and in such circumstances as to lead "legitimately to the conclusion that so far as the deposit is "concerned it constitutes the agreement between the parties.” With these considerations in mind their Lordships proceed to examine the facts of the present case. It appears that toward the end of 1923, three brothers, Kedar Nath Saha, Atindra Nath Saha and Jnanendra Nath Saha, who, or their representatives, are the present respondents, arranged with the appellants for a loan of Rs. 25,000, for which certain property in Calcutta owned by the borrowers was to be the security. The parties having reached agreement as to the terms of the loan, the transaction was carried out as follows On July 24, 1924, a meeting took place at the office of the attorneys for the appellants at which were present Hari Mohan Paul, one of the two appellants, on behalf of himself and his brother, the other appellant, and Jnanendra Nath Saha, on behalf of himself and his two brothers. At this meeting a document was signed by Jnanendra Nath Saha setting out the terms and conditions of the advance. It provided that Rs. 12,000 should be paid on that day, and the balance of Rs. At this meeting a document was signed by Jnanendra Nath Saha setting out the terms and conditions of the advance. It provided that Rs. 12,000 should be paid on that day, and the balance of Rs. 13,000 on or before July 31, 1924 ; that the rate of interest was to be 9 per cent, per annum, and that the period of the loan was to be one year from August 1, 1924. It further provided that the advance of Rs. 12,000 " will be "made on the deposit of the documents of title relating to "the premises, No. 75, Beniatolla Street, above-mentioned, "and after the balance of Rs. 13,000 shall be paid the "mortgagors will execute in favour of the mortgagee a "memorandum evidencing the said deposit and embodying "the terms and conditions of the loan." Jnanendra, having signed this document, formally handed over the title-deeds to the appellants attorneys, saying as he did so " For the sum of Rs. 12,000 which I have taken "out of the loan of Rs. 25,000 I am depositing these documents "of title by way of security or mortgage." The sum of Rs. 12,000 was thereupon paid over to Jnanendra, who signed a receipt on the memorandum for the sum of Rs. 12,000 advanced " on the security and upon the terms and "conditions hereinbefore mentioned." Subsequently, on August 2, 1924, the balance of Rs. 13,600 was paid to Jnanendra, who repeated the formality of handing the title-deeds to the appellants attorneys, stating that " for the sum of Rs. 12,000 which I have already received "out of Rs. 25,000, and for the sum of Rs. 13,000 which I am "receiving now, these documents will be kept in security." Later on the same day Jnanendra executed the memorandum of agreement now in question. This memorandum of August 2, 1924, is a formal and elaborate document. It designates the borrowers as the mortgagors and the lenders as the mortgagees, and recites that the mortgagors are the owners of the property described in the first schedule, that the mortgagors had applied to the mortgagees to lend them Rs. 25,000, and that the mortgagees had agreed to make this advance on the security of the documents of title specified in the second schedule. It further recites that the mortgagees had, on July 24, 1924, paid to the mortgagors Rs. 25,000, and that the mortgagees had agreed to make this advance on the security of the documents of title specified in the second schedule. It further recites that the mortgagees had, on July 24, 1924, paid to the mortgagors Rs. 12,000, and that as security for this sum the mortgagors had deposited with the mortgagees agents the documents of title specified in the second schedule, and that the mortgagees prior to the execution of the memorandum had paid over the balance of Rs, 13,000. The memorandum then proceeds to set out that it is thereby agreed and declared between the parties that in consideration of the two sums of Rs. 12,000 and Rs. 13,000 paid before the execution of the memorandum, the title-deeds described in the second schedule, " which said deeds, evidences and " writings have as hereinbefore stated prior to the execution "of this agreement been delivered by the mortgagors to the "mortgagees said agents in the town of Calcutta with intent "to create a security on the said hereditaments and premises "described in the said first schedule hereto such as is "contemplated in the concluding proviso to s. 59 of the "Transfer of Property Act (such security having been created "prior to the execution of this agreement by the delivery of "the documents hereinbefore mentioned—would [sc. shall] "be held by the mortgagees as such security as aforesaid for "the payment by the mortgagors to the mortgagees at the "time and in the manner hereinafter mentioned and the costs " (as between attorney and client) charges and expenses of and "incidental to any proceeding which may be had for the "protection of this security or for procuring or obtaining or " attempting to obtain payment of the moneys hereby secured/ There follows a series of heads dealing with the date of repay ment, rate of interest, consequences of default, warranty of title and various other matters, and the memorandum in conclusion confers on the mortgagees a power of sale of the mortgaged property. A receipt for the total sum of Rs. 25,000 is appended. Such being the tenour of the memorandum of August 2, 1924, and such the circumstances attendant on its execution and delivery, the question is whether it required to be registered. A receipt for the total sum of Rs. 25,000 is appended. Such being the tenour of the memorandum of August 2, 1924, and such the circumstances attendant on its execution and delivery, the question is whether it required to be registered. Lort-Williams J. held that it did not, being satisfied that the " memorandum was nothing but a record of what "had been agreed to orally on July 24," and was " not a "document containing the bargain made between the parties." On appeal, Costello J., with whom Panckridge J. concurred, was of the contrary opinion, holding that " the writing was of "such a character as calls for registration," for the reasons set out in a long and careful judgment. (I. L. R. [ 1937] 2 C. 586.) Their Lordships find themselves in agreement with the Appellate Court. The leading feature of this case is that the appellants advisers were evidently quite aware of the niceties of the law in the matter, and deliberately endeavoured to effect a valid mortgage by delivery of title-deeds and at the same time to accompany it with an effective written document which would nevertheless not require registration. The appellants, in their Lordships opinion, have over-reached themselves, and have failed to achieve their purpose. In the first place, it is made clear by the earlier memorandum of July 24, 1924, that the parties contemplated from the outset that a document should be executed " evidencing the said " deposit and embodying the terms and conditions of the "loan," and this earlier memorandum bears an acknowledgment of the receipt of the first instalment of the loan as having been advanced " on the security and upon the terms and "conditions hereinbefore mentioned." When the memorandum of August 2, 1924, subsequently executed, is examined, it is found to contain all the essentials of the transaction. It states that it is hereby agreed and declared between and by the parties that in consideration of the sums advanced the title-deeds of the property shall be held as a security on the said property, and refers to any proceeding which may be had for the protection of this security or for procuring payment of the moneys hereby secured. It then sets out all the details of the transaction, and specifically confers a power of sale on the mortgagees. It then sets out all the details of the transaction, and specifically confers a power of sale on the mortgagees. It is true that in the parenthetical passage, quoted above, the title-deeds are stated to have been previously delivered with intent to create a security; but that does not alter the character of the memorandum itself, which, if the parenthetical passage be disregarded, is an instrument effective to create an interest in the property in favour of the mortgagees. Having purported to create a mortgage by delivery of title-deeds, the parties proceeded to create it over again in writing. The memorandum does not merely evidence a transaction already completed ; its language is operative. It is contractual in form, and it embodies an agreement that the title-deeds in question are to be held as security for the advances made, and it speaks of the moneys " hereby secured," It not only contains all the terms on which the moneys were advanced, but it expressly confers a power of sale. It is noteworthy that in the appellants " concise statement " of their claim in the plaint they state that they sue for a decree " for realisation of the principal and arrears "of interest due and payable under a memorandum of "agreement dated August 2, 1924." Their Lordships are of opinion that where, as here, the parties professing to create a mortgage by deposit of title-deeds contemporaneously enter into a contractual agreement, in writing, which is made an integral part of the transaction, and is itself an operative instrument and not merely evidential, such a document must under the statute be registered. The appeal accordingly fails. Their Lordships will humbly advise His Majesty that the decree of the Appellate Court of April 6, 1937, be affirmed, and the appeal dismissed. The legal representatives of the respondent Kedar Nath Saha, who alone appeared, will have their costs of the appeal.