Order XXXIV Rule 10 CPC: Costs of Mortgagee Subsequent to Decree
Order XXXIV Rule 10 of the Code of Civil Procedure, 1908 (CPC) governs the costs, charges and expenses that may be added to the mortgage amount after a preliminary decree in a mortgage suit. It applies when the court finally adjusts the sum payable to a mortgagee in proceedings for foreclosure, sale or redemption.
Order XXXIV Rule 10 CPC - statutory provision
In finally adjusting the amount to be paid to a mortgagee in case of a foreclosure, sale or redemption, the Court shall, unless in the case of costs of the suit the conduct of the mortgagee has been such as to disentitle him thereto, add to the mortgage-money such costs of the suit and other costs, charges and expenses as have been properly incurred by him since the date of the preliminary decree for foreclosure, sale or redemption up to the time of actual payment:
Provided that where the mortgagor, before or at the time of the institution of the suit, tenders or deposits the amount due on the mortgage, or such amount as is not subsequently deficient in the opinion of the Court, he shall not be ordered to pay the costs of the suit to the mortgagee and the mortgagor shall be entitled to recover his own costs of the suit from the mortgagee, unless the Court, for reasons to be recorded, otherwise directs.
Meaning and scope of Rule 10
The provision addresses adjustments made after a preliminary decree and before actual payment. A preliminary decree determines the mortgage-related rights and the amount due at an earlier stage; the final adjustment may account for additional properly incurred expenditure arising subsequently.
Mortgagee means the person in whose favour the mortgage is created; mortgagor means the person who creates the mortgage. These terms are defined in section 58(a) of the Transfer of Property Act, 1882. Mortgage-money means the principal money and interest secured by the mortgage within that statutory definition.
Preliminary decree refers to a decree that determines rights while further proceedings remain necessary before the suit is fully disposed of, as described in section 2(2) CPC. The rules for mortgage suits are found in Order XXXIV of the First Schedule to the CPC.
Which costs can the mortgagee recover?
Rule 10 permits the court to add qualifying suit costs and other costs, charges and expenses properly incurred by the mortgagee between the preliminary decree and actual payment. The expenditure must be justified by the circumstances of the mortgage proceedings. The rule does not authorise recovery of every amount claimed without scrutiny.
When deciding suit costs, the court must also consider the mortgagee's conduct. Misconduct that disentitles the mortgagee to those costs can affect the order. This qualification relates expressly to the costs of the suit.
Effect of tender or deposit before the suit
The proviso protects a mortgagor who tenders or deposits the mortgage amount before or at the institution of the suit, provided the sum is the amount due or is not later found deficient in the court's opinion.
In that situation, the mortgagor ordinarily need not pay the mortgagee's suit costs and is entitled to recover the mortgagor's own suit costs from the mortgagee. The court may depart from that result, but must record its reasons.
The timing and sufficiency of the tender or deposit are therefore important. Evidence of the amount offered, the date of the offer or deposit, and its terms may be material to the court's decision.
How the court applies Order 34 Rule 10
- Identify the preliminary decree and the amount already found due.
- Examine the costs, charges and expenses claimed after that decree up to actual payment.
- Decide which expenses were properly incurred and whether the mortgagee's conduct affects suit costs.
- Check whether the mortgagor made a timely and sufficient tender or deposit before or when the suit was instituted.
- Make the appropriate final adjustment and give recorded reasons if departing from the proviso's usual costs consequence.
Interest on mortgage amounts is separately addressed by Order XXXIV Rule 11 CPC. Rule 10 should therefore be read alongside the preliminary and final decree provisions relevant to the particular mortgage suit.
Illustration
Suppose a preliminary decree fixes the amount payable to a mortgagee. Before actual payment, the mortgagee incurs necessary, properly documented expenses relating to the mortgage proceedings. When adjusting the final amount, the court may include qualifying post-decree expenses under Rule 10. Conversely, if the mortgagor had tendered the full amount due before the suit began, the proviso generally changes who bears the suit costs, subject to a reasoned contrary direction.
Frequently asked questions
Does Rule 10 apply only to redemption suits?
No. It expressly covers the final adjustment of amounts in foreclosure, sale and redemption proceedings.
Are all post-decree expenses automatically recoverable?
No. The costs, charges and expenses must have been properly incurred, and the court must consider the relevant qualifications in the rule.
Can a mortgagor recover suit costs after tendering the mortgage amount?
Yes, where the proviso's conditions are satisfied, subject to the court's power to direct otherwise for recorded reasons.
Related legislation and official resources
Read the India Code official legislation portal for the Code of Civil Procedure, 1908 and the Transfer of Property Act, 1882. The operative text and any applicable state amendments should be checked for the court and jurisdiction concerned.
Related provisions: Order XXXIV Rule 9, Rule 10A and Rule 11.