Prabhu Dayal v Official Receiver

Facts

• Document purported to create a mortgage but was not registered
• Under S.59, unregistered document cannot operate as mortgage
• Question: does it create any enforceable interest at all?

Issue

1. Whether an unregistered document creating security over immoveable property creates a valid charge under S.100.

Held

• The document fails as a mortgage but succeeds as a charge. S.100 does not require registration. If the document clearly identifies property as security for a debt, it creates a charge enforceable by court sale.

Ratio Decidendi

A charge is weaker than a mortgage (no interest transferred) but requires no formalities. An instrument that fails the higher requirement (registration for mortgage) may still satisfy the lower requirement (mere security identification for charge). The creditor gets an enforceable, if limited, remedy.