Judgment ANIL KUMAR SEN, J. 1. THIS is an appeal by the claimants in a proceeding under Order 21 Rule 58 of the Code of Civil Procedure which was registered as Judicial Misc. Case No. 7 of 1983 and is directed against an order dated February 6, 1984. By the order impugned the learned Judge has over-ruled the claim. 2. IT is not in dispute that a partnership firm of which Chandan Kumar Sai and Manindra Nath Jana were the two partners took a loan from the decree- holder United Bank of India on hypothecation of a truck bearing no. W. B. C. 3451. IT is alleged that the two partners rendered themselves personally liable for the debt so incurred and furnished their personal properties by way of security. The present dispute relates to Manindra Nath Jana's share in plot no. 101, Khatian no. 132 of Mouza Sayedpur, P. S. Ramnagar, District : Midnapore. In his share would fall about 13 decimals out of the plot. The United Bank of India filed a mortgage suit against the partnership firm as also partners and the other guarantors being Mortgage suit no. 28 of 1978. This suit was filed in April, 1978. The suit was decreed on May 20, 1980 and the Bank then in execution qf the said decree attached the aforesaid property being plot no. 101, khatian no. 132 in mortgage execution case no. 5 of 1981. The present claimants put forward a claim to the effect that by two successive transfers dated May 31, 1977 and November 27, 1976 Manindra Nath Jana sold his share in the aforesaid plot no. 101, Khatian no. 132 in favour of the claimants. They are not hound by the decree and the property purchased by them was not liable to be sold in execution of the decree. This objection has been overrule by the learned Assistant District Judge, second court, Midnapore by the order impugned on a finding that since the claimants were the purchasers with notice of the charge over the property in favour of the bank they cannot avoid the liability of the property being sold for realisation of the decretal amount outstanding. Feeling aggrieved by this order the claimants have preferred the present appeal. 3. MR. Ghosh, appearing in support of this appeal, has raised a short point which, in our opinion, is clearly unassailable. According to MR.
Feeling aggrieved by this order the claimants have preferred the present appeal. 3. MR. Ghosh, appearing in support of this appeal, has raised a short point which, in our opinion, is clearly unassailable. According to MR. Ghosh, even if Manindra Nath Jana were intended to furnish his right, title and interest in the disputed plot no. 101, khatian no. 132 as security for the loan that has failed in the absence of any registration deed creating such a security. According to MR. Ghose, Manindra Nath Jana did not execute any registered deed of mortgage furnishing his right, title and interest in the aforesaid plot as security for the loan in favour of the bank. MR. Ghosh has already relied upon the finding of the learned Assistant District Judge that there was no such mortgage. But It has been pointed out by MR. Ghosh that the learned Assistant District Judge failed to appreciate that even if the transaction, between the parties, namely Manindra Nath Jana and the United Bank 6f India with regard to the disputed property be considered to be a charge it was required to be done by a registered deed and in the absence of registration it must fail as a charge. Therefore, according to MR. Ghosh, it is wholly immaterial as to whether the present claimants were transferees of the property with notice of the charge or not. He was, however, assailed the rinding with regard to the notice as recorded by the learned Assistant District Judge and has contended that on the evidence on record the learned Assistant District Judge was not justified in holding that the claimants had previous notice or knowledge about the creation of any such charge. The appeal is being contested on behalf of the decree-holder by MR. Roy. According to MR. Roy, since the bank had already obtained a mortgage decree in respect of the said property it is not permissible for the court in a proceeding under order 21 Rule 58 to question the decree or modify the same by holding the transaction to be merely, a charge not a mortgage. In his fairness MR. R05, however, has frankly conceded that in order to make a charge it would have been necessary for the parties to go far registration. 4. WE have carefully considered the rival contentions put forward before us.
In his fairness MR. R05, however, has frankly conceded that in order to make a charge it would have been necessary for the parties to go far registration. 4. WE have carefully considered the rival contentions put forward before us. Before we proceed to consider the points raised by Mr. Ghosh it would be necessary for us to dispose of the objection raised by Mr. Roy on behalf of the decree-holder. It is true that the Bank obtained a mortgage decree against the partnership along with others including the two partners personally. But sines the claimants are all purchasers prior to the suit they would not be bound by the decree so that if they can establish in the present proceeding that there was no mortgage in respect of the disputed property they can still support their claim notwithstanding the decree which would not affect the right, title and interest of the transferee, That apart we have looked into the plaint and judgment decreeing the suit to find out how far Mr. Roy is right in contending that there was a mortgage decree in respect of this property obtained by the Bank. Admittedly there was no registered deed of mortgage in respect of the property. There was also no averment of any equitable Mortgage in the plaint of Mortgage suit No. 28 of 1978 in respect of this property. True that was a mortgage suit. But that suit covers the other securities including the motor truck which was the subject matter of hypothecation. Tins being, the position, it is quite clear to us that so far as the disputed property being plot no. 101, khatian no. 132 of mouza Sayedpur is concerned, the decree obtained by the bank could not have been a mortgage decree. This position is made further clear by the fact that in the execution the decree-holder bank had taken out an attachment of a mortgage decree for sale. To us it appears that any claim of mortgage as against the claimants by the bank is wholly in admissible in the admitted situation, namely that there was no registered deed of mortgage in favour of the bank nor did the batik ever make out any case of equitable mortgage. Therefore, we over-rule the objection raised by Mr. Roy and we proceed to consider the points, raised by Mr. Ghosh.
Therefore, we over-rule the objection raised by Mr. Roy and we proceed to consider the points, raised by Mr. Ghosh. The learned Judge has rightly proceeded on the basis that the decree obtained by the bank in respect of the disputed property was not a decree for enforcement of a mortgage but enforcement of a charge. According to Mr. Ghosh, the original transaction between the Manindra Nath Jana and the bank if it was intended to be creation of a charge it must be held to have failed on the ground that there was no registered deed creating such a charge. According to Mr. Ghose, registration is a must for the purpose of creating a charge. Though under section 100 of the Transfer of Property Act there is no express provision for any such requirement and though it is well settled by now that in creating a charge there is no transfer of the property yet it appears to us that it is more or less settled that even for creating a charge registration is a necessity. Chief Justice Rankin in the case of Imperial Bank of India Vs. Bengal National Bank, ILR 53 Cal 136, observed that a charge creates interest in the property and as such is required to be registered under section 17(1) (b) of the Registration Act. This decision was no doubt reversed by the Judicial Committee in 58 I.A. 323 but it was no reversed on another point and not on the point at issue. There is some divergence of judicial opinion as to whether the charge creates an interest in the property because in some of the pronouncement, we find that the Judges preferred to hold that it creates rather a right in the property which also would attract the provisions of section 17(1)(b) of the Registration Act. There is other line of decisions which have held that under section 100 of T. P. Act has made applicable the provisions contained in the Transfer of Property Act with regard to a simple mortgage, to the charge. It has, therefore, been held that necessarily section 59 of the Transfer of property Act is invoked and it becomes a necessity to have registration to create a charge.
It has, therefore, been held that necessarily section 59 of the Transfer of property Act is invoked and it becomes a necessity to have registration to create a charge. Though considered from different aspects it appears to us that there is consensus of judicial opinion that in order to create a. charge on a property it is necessary that it would be so created by a registered deed so that in the absence of registration it would fall as a charge in view of the provisions of section 49 of the Indian Registration Act. Reference may be made to a recent decision of the Allahabad High Court in the case of Krishna Deva Bhargava and Cithers vs. Official Liquidator U. P. Inautres Ltd. AIR 1962 All 101 which [has been fairly pointed out to us by Mr. Roy appearing for the Bank. In this view we cannot but accept the contention of Mr. Ghosh that the alleged claim of the decree-holder bank for enforcement of a charge on the disputed property must fail as against the present claimants who purchased the property prior to the suit and it would be so irrespective of whether they had any previous knowledge or notice of the charge created by Manindra in favour of the bank. Therefore, it becomes unnecessary for us to consider the other point raised by Mr. Ghosh, namely that on the evidence on record prior knowledge or notice of the claimants had not been made Out so that the claimants must be considered to be purchasers for value without any notice of the charge. 5. IN the result, the appeal succeeds and is allowed. The claim put forward under order 21 Rule 58 in. respect of the share of Manindra Nath Jaha in plot no. 101 khatian no. 132 of mouza sayedpur P. S. Ramnagar District Midnapore succeeds and is allowed. That property should, therefore, be released from attachment. All our observations made herein must be taken to be limited for the disposal of the claim with regard to Manindra share in the disputed plot only.