ENGLISH MORTGAGE

ENGLISH MORTGAGE IN FAVOUR OF A BANK

 

This indenture made at____________the____________day of____________between X Y Z Co. Ltd., a Company incorporated under the Companies Act, 1956 and having its registered office at ........................... hereinafter referred to as the "Mortgagor" (which expression shall unless be repugnant to the context or meaning thereof be deemed to include its Successors and permitted assigns) of the ONE PART and.................Bank, a banking corporation constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 and having its registered office at____________and amongst other places a Branch____________hereinafter called the Mortgagee, (which expression shall unless be repugnant to the context or meaning thereof be deemed to include its Successors and assigns) of the OTHER PART.

 

WHEREAS the Mortgagor is a company incorporated under the Companies Act, 1956 and having authorised share capital of Rs. .................divided into____________shares of Rs____________each and carrying business of____________at____________

 

AND WHEREAS the Mortgagor is absolutely seized and possessed of or otherwise well and sufficiently entitled to the land and premises bearing Plot No ____________Survey No____________ situate, lying and being at Village____________Taluka____________within the Registration District and Sub?District of____________and more particularly described in the First Schedule hereunder written and hereinafter referred to as the said land.

 

AND WHEREAS the Mortgagor has erected factory and buildings on the said land and installed machineries, plants and fixtures, the details of which have been given in the Second Schedule hereunder.

 

AND WHEREAS the Mortgagor is in need of Rs ____________for the purposes of purchase of some machineries and working capital and has approached the Mortgagee to grant loan of Rs . ...................... which the Mortgagee has agreed to do upon having the repayment thereof with interest secured to it in the manner hereinafter appearing.

 

NOW THIS INDENTURE WITNESSETH THAT in pursuance of the said agreement and in consideration of the sum of Rs ____________at or before the execution of these presents lent and advanced by the mortgagee to the mortgagor (the receipt whereof the Mortgagor doth hereby   acknowledge and of and from the same doth hereby release and discharge the Mortgagee), the Mortgagor doth hereby covenant with the Mortgagee that the Mortgagor shall repay to the Mortgagee the said sum of Rs____________(Rupees____________) (hereinafter referred to as the said principal sum) together with interest for the same in meantime at the rate of____________per cent per month from the date of these presents by equal monthly payments, the first of such payments shall be made on the____________day of..................... now next and the subsequent payments shall be made regularly before 10th of each month and shall in case and so long as the said principal sum or any part thereof shall remain unpaid, pay to the Mortgagee interest on the said principal sum or so much thereof as shall for the time being remain unpaid at the time and the rate aforesaid. Provided always and it is hereby agreed and declared that if default shall be made in payment of any instalment of interest hereby reserved or any part thereof at the time hereinbefore appointed in that behalf, then the unpaid instalment of interest or part thereof shall be added to the principal sum for the time being then due and be payable from time on the day hereinbefore appointed for the payment of interest on the principal sum on the footing of compound interest computed at the same rate aforesaid with rests made on monthly on the date hereinbefore provided for payment of interest and all such compounded interest shall be a charge on the said properties, structures and machinery hereby

mortgaged and charged provided however that this provision shall not be deemed to authorise the Mortgagor to allow any interest to fall in arrears nor shall it in anywhere prejudice, limit or affect the powers of the mortgagee to take any legal proceedings or other action under these presents to recover the interest or other moneys due under these presents that may have been in arrears and remain unpaid of the said agreement and in consideration of the premises, the mortgagor doth hereby grant, convey, transfer and assure unto the mortgagee all that piece or parcel of land together with all the buildings, messages and tenement now standing thereon or which may hereafter be erected upon or any of them or any part thereof bearing Plot No..

 

AND THIS INDENTURE ALSO WITNESSETH THAT in pursuance ............... Survey No . ____________situate, being and lying at Village____________Taluka____________within the Registration District and Sub?District of      more particularly described in the First Schedule   hereunder written and delineated on the Plan thereof hereto annexed and thereon shown surrounded by a red coloured boundary line. Together with all and singular, the houses, outhouses, wells, water, water courses, ways, paths, gullies, passages, lights, liberties, privileges, easements, advantages and appurtenances whatsoever to the said land, machineries, and  structures, appertaining or with the same or any part thereof now or heretofore occupied or enjoyed or reputed or known as part, parcel or member thereof or appurtenant thereto and all the estate, right, title, interest, claim and demand of the Mortgagor into and upon the said land and buildings or any part thereof, to have and to hold the said land and buildings and all other premises hereinbefore expressed to be hereby granted with all and every of their appurtenances unto and to the use of the Mortgagee, subject to the proviso for redemption hereinafter  provided.

 

AND THIS INDENTURE FURTHER WITNESSETH THAT in further pursuance of the said agreement and in consideration of the premises, the Mortgagor doth hereby assign, transfer and assure unto the   Mortgagee all and singular the machineries, plants, fixtures, engines, boilers, motors, equipments, accessories, chattels and things, (whether fixed or movable and whether attached to the said land), the         detailed particulars of which have been given in Second Schedule hereunder written, which now are or which may at any time hereafter during the continuance of this security be affixed, installed or erected or be brought in or placed upon the said land and buildings by the Mortgagor for the purpose of its business (all such plants and assets hereinafter referred to as the said structures and machineries) and all the estate, right, title, interest, claim and demand of the Mortgagor unto and upon the said structures and machineries, to have and to hold the said structures and machineries, unto the mortgagee absolutely subject to the proviso for redemption hereinafter contained.

 

AND THIS INDENTURE ALSO WITNESSETH THAT the mortgagor hereby charges in favour of the Mortgagee all the property and assets of the Mortgagor for the time being both present and future other than the mortgaged premises including its goodwill, uncalled capital, book debts and outstanding monies, held in cash or in bank accounts, funds  created by the Mortgagor'?and the investments for the time being representing the same (hereinafter referred to as "all assets") with the payment of all moneys for the time being owing by the Mortgagor under these presents and such charge shall rank as floating charge and shall in no way hinder or prevent the Mortgagor from selling, leasing, mortgaging, charging, transferring or otherwise disposing of or dealing with in the ordinary course of business for the purpose of carrying on the same, but the Mortgagor will obtain prior consent of the Mortgagee before creating any encumbrance upon all assets charged or any part thereof ranking in priority to or pari passu with the security hereby constituted.

 

PROVIDED ALWAYS AND IT IS HEREBY AGREED AND DECLARED THAT if the Mortgagor shall pursuant to the covenant in that behalf hereinbefore contained on the____________day of.....................20____________pay to Mortgagor the sum of Rs ____________ with interest for the same at the rate and in manner hereinbefore  mentioned and also other moneys payable by law by the Mortgagor or under these presents, hereinafter referred to as the Mortgage debt, then in such case the Mortgagor shall upon and at the costs, charges and expenses of the Mortgagor reconvey the lands and buildings and the said structures and plants and release all assets from the charge hereby created (all of them hereinafter referred to as the Mortgaged premises) unto and to the use of the Mortgagor or as it may direct and shall also deliver to the Mortgagor, this Mortgage deed and or documents relating to mortgaged premises which shall be in the possession or power of the Mortgagee.

 

(2) The Mortgagor hereby covenants with the mortgagee as follows:

 

(i) That the Mortgagor is the absolute owner of the mortgaged premises and it is authorised to dispose of the same and the said mortgaged premises are free from any encumbrances, charge or lien whatsoever.

 

(ii) That if the Mortgagor fails to pay the said principal sum or interest thereon or any part thereof or commits default in the performance or observance of any of the covenants, conditions or provisions herein contained and on the part of the Mortgagor to be observed and performed then the Mortgagee shall be entitled and authorised to enter into and upon and take possession of the mortgaged premises and thenceforth quietly to hold, possess and enjoy the same and receive the rents, income, profits and benefits thereof without any denial, let, eviction, interruption, claim or demand by the Mortgagor or by any person        or persons whomsoever. And that in such case the Mortgagee shall pay all the outgoings of the mortgaged premises as the agent of the Mortgagor and shall appropriate the surplus of the rents, profits and income over the outgoings first in payment of the interest accruing to the Mortgagee under these presents and thereafter towards the principal sum due under these presents. And that the Mortgagor hereby indemnify and keep indemnified the mortgagee from and against all and all claims, demands, charges and encumbrances on the mortgaged premises whatsoever.

 

(iii)That the Mortgagor and his legal heirs, executors, administrators, assigns or all other persons lawfully or equitably claiming or entitled to claim any estate, right, title or interest into or upon the mortgaged premises or any of them or any part thereof respectively shall and will from time to time and at all times hereafter at their own  cost execute, make and do or cause or procure to be executed made and done every such assurance, act and thing for further or more perfectly assuring all or any of the mortgaged premises unto and to the use of Mortgagee as shall be reasonably required.

 

(iv)That all assets aforesaid are the absolute property of the Mortgagor and at the sole disposal of the Mortgagor and free from any charge or encumbrance.

THIS DEED OF MORTGAGE is made at ... this ... day of ... between Mr. A ... residing at ... hereinafter referred to as 'the Mortgagor' of the One Part, and (1)... (2) ... (3)... all of ... carrying on business In partnership An the name of M/s  ... as financiers and money lenders and having their office at ... hereinafter referred to as the Mortgagees (which expression shall also include the partners or partner for the time being of the said Firm, the survivors or survivor of them and the heirs, executors, administrators of the last surviving partner. their or his assigns ) of the Other Part:

WHEREAS the Mortgagor is seized and possessed of and otherwise well and sufficiently entitled to a piece of land with a building thereon situate at ... and more particularly described in the Schedule hereunder written.

AND WHEREAS the Mortgagor being in need of money for the purpose of making certain family expenses has requested the Mortgagees to advance to him a sum of Rs... on the security of a First Legal English Mortgage of his said property, which the Mortgagees have agreed to do on the Mortgagor executing these presents.

NOW THIS DEED WITNESSETH as follows: -

1.         Covenant to pay principal :-

That in pursuance of the aforesaid agreement and in consideration of the sum of Rs... (Rupees ... ) on or before the execution of these presents advanced by the Mortgagees to the Mortgagor (receipt whereof the Mortgagor doth hereby acknowledge) he the Mortgagor doth hereby covenants with the Mortgagees that the Mortgagor will pay to the Mortgagees in  ........    the said sum of Rs... on the ... day of... (hereinafter referred to as 'the due date' which expression shall also mean the date on which the amount hereby secured becomes due and payable under and by virtue of any of the terms of these Presents Irrespective of whether the said date has expired or not)

2. Covenant to pay Interest :-

The Mortgagor will In the meantime pay to the Mortgagees interest on the said amount of Rs... at the rate of... per cent per annum from the date hereof by monthly rests, the first of such payment to be made on the ... day of ... next and the subsequent payments to be made regularly at the expiration of each month and will also pay thereafter, in case and so long as the said principal sum of Rs... or any part thereof shall remain unpaid to the Mortgagees, interest on the same or for so much thereof as shall for the time being remain unpaid at the rate of ... per cent per annum by monthly rests on the ... day of each and every month in the manner aforesaid.

3.         Covenant to pay compound Interest :-

And IT IS HEREBY AGREED AND DECLARED THAT

1. if default shall be made In payment of any one Instalment of Interest hereby reserved or any part thereof at the respective times hereinbefore appointed In that behalf then and In every such case the unpaid Instalment of Interest or part thereof shall be added to the mortgage debt for the time being then due as or in the nature of a further advance and shall thereon carry further interest at the like rate of ... per cent per annum which shall be deemed to accrue due and become payable from time to time on the respective days hereinbefore appointed for the payment of interest on the original principal sum so that by the addition and capitalisation of interest as aforesaid the total principal moneys hereby secured may be augmented upon the footing of an accumulation by way of compound interest computed at ... percent per annum with rests taken and made very month and that all such additions by way of capitalised interest (whether on the original principal sum or any interest added thereto as aforesaid) shall be chargeable upon the mortgaged premises and shall to all intents and purposes be within the scope and operation of the present security including all covenants, powers and provisions contained herein which are rendered applicable by reference or otherwise to such additions.
2. That the aforesaid provisions shall not in any way be deemed to authorise the Mortgagor to refuse to pay any interest or allow any interest to fall in arrears unless permitted to do so by the Mortgagees nor shall anywise interfere with or prejudice limit or affect the powers of sale under section 69 of the Transfer of Property Act or under these Presents or of entry or any other powers or remedies for securing and enforcing payment of the mortgage debt hereinafter contained and that the Mortgagor shall. notwithstanding the capitalisation thereof, upon demand pay the Mortgagees any interest which shall be capitalised hereunder and any interest which shall accrue due thereon.

4.         Grant of the premises as security :-

AND THIS DEED FURTHER WITNESSETH that in further pursuance of  the said Agreement and for the consideration aforesaid the Mortgagor doth hereby grant, and transfer unto the Mortgagees all the said piece of land together with the building and structures now standing or to be hereafter erected thereon or any part thereof and situated at ... and more particularly-. described in the Schedule hereunder written, together with all and singular the thing attached thereto or standing thereon and all the rights, liberties, privileges, casements, advantages and appurtenance whatsoever to the said land and premises or any part thereof belonging or in anywise appertaining or usually held or enjoyed or occupied therewith or reputed to belong or be appurtenant thereto and all the estate, right, title, interest, property claim and demand whatsoever of the Mortgagor and every part thereof TO HOLD the said lands and other the premises hereby granted or expressed so to be unto and to the use of the Mortgagees absolutely but subject to the provision for redemption hereinafter contained.

5.         Covenant for redemption :-

PROVIDED ALWAYS AND IT IS HEREBY AGREED, DECLARED that if the Mortgagor shall pursuant to the covenant in that behalf hereinbefore contained pay to the Mortgagees In (city) the said sum of Rs... with interest for the same at the rate and in the manner hereinbefore mentioned and also all other the moneys, costs charges, and expenses by law or under these presents payable by the Mortgagor to the Mortgagees (hereinafter referred to as 'the Mortgage debt') then and In such case the Mortgagees shall upon the request and at the costs, charges and expenses of the Mortgagor retransfer the said land and premises described in the Schedule hereunder written and all other the premises hereby granted or expressed so to be (hereinafter referred to as 'the mortgaged premises') unto the Mortgagor or the person entitled to such transfer or as he may direct or If the Mortgagees are not In possession of the Mortgaged premises. the Mortgagees shall if so required by the Mortgagor or any subsequent encumbrance and at the costs. charges, and expenses of the mortgagor or such encumbrance, assign the Mortgage debt and transfer the mortgaged premises to such third person as the Mortgagor or such encumbrance may direct and shall also deliver to the Mortgagor or such third person as the case may be. this Mortgage Deed and all documents relating to the mortgaged premises which shall be in the possession or power of the Mortgagees.

6.         Mortgagor to remain in possession:-

AND IT IS HEREBY FURTHER AGREED BY AND BETWEEN THE PARTIES HERETO THAT,

1. so long as the aforesaid right of redemption subsists the Mortgagees shall allow the Mortgagor at all reasonable times and at his request and at his own costs and on payment of the costs and expenses of the Mortgagees in that behalf, to inspect and make copies or abstracts of or extracts from the said documents of title relating to the mortgaged premises which shall be In the custody or power of the Mortgagees.
2. THAT until default is made by the Mortgagor in payment of the said principal sum or Interest or any part thereof the Mortgagor shall remain in the possession of or in receipt of the rents and profits of, the Mortgaged premises provided that the Mortgagor shall. while in possession of the mortgaged premises as aforesaid, have no power to make any leases thereof -save and except (i) with the previous consent In writing of the Mortgagees and (ii) for such period and on such terms and conditions as the Mortgagees shall in their absolute discretion think proper.

7.         Covenant of title and other covenants by Mortgagor.-

AND THE MORTGAGOR DOTH HEREBY COVENANT WITH THE MORTGAGEES THAT

(a)       Covenant of title:-

The Mortgagor now has good right and full power to grant and mortgage the said land and building and other the premises hereby granted or transferred or expressed so to be and every part thereof unto and to the use of the Mortgagees in manner aforesaid.

1. Power to take possession:-

If default shall be made in payment of the said sum of Rs... or interest thereon or any part thereof respectively on the days hereinbefore appointed for payment of the same respectively the Mortgagees may at any time thereafter enter into and upon the said mortgaged premises or any of them or any part thereof in the name of the whole and shall thenceforth quietly possess and enjoy the same and receive the rents income and profits thereof without any lawful interruption or disturbance whatsoever by the Mortgagor or any person or persons lawfully claiming under him or any of them and shall. until the Mortgagor shall have tendered or deposited under section 83 of the Transfer of Property Act, 1882. the amount for the time being due under these presents, be at, liberty (but under no obligation) to pay thereout the Government revenue and all other charges of a public nature and all rent (if any) accruing due in respect of the mortgaged premises during such possession and any arrears of rent in default of payment of which the land and premises may be summarily sold and all expenses incurred for the management of the mortgaged premises and the collection of rents, Income and profits. and all other outgoing including costs of repairs (if any) of the mortgaged premises as agent of the Mortgagor with Interest thereon at the rate provided under these presents and shall appropriate the net rents, income and profits or the surplus thereof over the outgoing (if any) in reduction of the amount from time to time due to them on account of Interest accruing due to them under the covenant hereinbefore contained in that behalf and if there be any surplus, shall appropriate the same In reduction or discharge of the principal of the mortgage debt.

(c)        Power on possession:-

It shall be lawful for the Mortgagees at any time after taking possession of the mortgaged premises, to make improvements thereon as they may in their discretion think proper and the Mortgagor will on redemption pay the Mortgagees the costs thereof in addition to the Mortgage debt with interest at the same rate as is payable on the principal amount due under these presents and that until such repayment the same shall he a charge upon the mortgaged premises and that the Mortgagees shall not be accountable for or be liable to give credit for the profits (if any) accruing by reason of the said Improvements.