foreclosure
Foreclosure is a decree that the mortgagor is absolutely debarred from redeeming, so that the property becomes the mortgagee's. Under s.67 of the Transfer of Property Act, 1882, the mortgagee may sue for foreclosure or for sale after the money becomes due. But only a mortgagee by conditional sale, or under an anomalous mortgage whose terms allow it, can sue for foreclosure; a simple mortgagee can only sue for sale, and a usufructuary mortgagee for neither.
The procedure is in Order XXXIV CPC: a preliminary decree fixes the amount and a period for payment, and if the mortgagor fails to pay, a final decree of foreclosure follows. Under English law foreclosure is common; in India it is limited, and the usual remedy is sale.
Example
Because the deed was a mortgage by conditional sale, the mortgagee could sue for foreclosure under s.67 instead of seeking a sale.
In Indian law
- Section 67, Transfer of Property Act, 1882
- Order XXXIV, Code of Civil Procedure, 1908
See also
mortgage · mortgage by conditional sale · equity of redemption · simple mortgage
Read more in the study notes
- Punishments under the BNS, including community service (Bharatiya Nyaya Sanhita)
- Place of suing (sections 15 to 21A) (Civil Procedure Code and Limitation Act)
- Practices controlled by competition law: an overview (Competition Law)
- Anti-competitive agreements: section 3, cartels and bid rigging (Competition Law)
- Theories of punishment (Jurisprudence)
- The rarest of rare doctrine (Penology and Victimology)