Order XXXIV Rule 10A CPC: Power of Court to Direct Mortgagee to Pay Mesne Profits
Order XXXIV Rule 10A of the Code of Civil Procedure, 1908 (CPC) protects a mortgagor who has tendered or deposited the mortgage dues before or when a foreclosure suit is instituted. In the circumstances specified by the rule, the court must direct the mortgagee to pay mesne profits from the date the suit was instituted.
Text of Order XXXIV Rule 10A CPC
Power of Court to direct mortgagee to pay mesne profits. Where in a suit for foreclosure, the mortgagor has, before or at the time of the institution of the suit, tendered or deposited the sum due on the mortgage, or such sum as is not substantially deficient in the opinion of the Court, the Court shall direct the mortgagee to pay to the mortgagor mesne profits for the period beginning with the institution of the suit.
The rule is specifically concerned with foreclosure suits, not every mortgage dispute. The court assesses whether the tender or deposit met the statutory threshold.
Meaning and essential legal definitions
Mortgagor and mortgagee
Under Section 58(a) of the Transfer of Property Act, 1882, a mortgage is a transfer of an interest in specified immovable property to secure payment of money or performance of an obligation. The transferor is the mortgagor and the transferee is the mortgagee.
Foreclosure
Foreclosure is a mortgage remedy by which the mortgagee seeks a court decree debarring the mortgagor from redeeming the mortgaged property, where the law and the nature of the mortgage permit that remedy. Section 67 of the Transfer of Property Act governs the mortgagee's right to seek foreclosure or sale, subject to its conditions and exceptions.
Mesne profits
Section 2(12) CPC defines mesne profits of property as profits which a person in wrongful possession actually received or might with ordinary diligence have received, together with interest on those profits, excluding profits attributable to improvements made by that person. For Rule 10A, the court applies the statutory direction to the mortgagee in the specified foreclosure circumstances; the quantum must be established on the facts.
Tender or deposit
A tender is an offer to pay the sum due; a deposit is payment of money into an appropriate forum or account as required by law. Rule 10A covers the amount due or an amount that, in the court's opinion, is not substantially deficient.
When does Rule 10A apply?
- A suit for foreclosure has been instituted.
- The mortgagor tendered or deposited the sum due on the mortgage before or at the institution of that suit.
- Alternatively, the tender or deposit was not substantially deficient in the court's opinion.
- The court determines the relevant facts and directs payment of mesne profits for the period beginning with the institution of the suit.
The rule uses the mandatory expression "shall direct" once its conditions are satisfied. It does not specify a fixed percentage or automatic monetary figure for mesne profits.
How a mortgagor may claim mesne profits
The mortgagor should place on record the mortgage documents, calculation of dues, evidence of the timely tender or deposit, and any supporting material concerning possession and income from the property. The court can then decide whether the payment was sufficient or not substantially deficient, and determine the appropriate relief and amount in accordance with the applicable procedure.
Evidence of tender may include correspondence, acknowledgments, bank instruments or court deposit records, depending on the circumstances. A disputed tender or deficiency requires judicial determination rather than an assumption that Rule 10A applies automatically.
Frequently asked questions
Does Rule 10A apply to every mortgage suit?
No. Its express wording applies to a suit for foreclosure where the required tender or deposit was made before or at the institution of the suit.
Must the mortgagor pay the exact sum claimed by the mortgagee?
Not necessarily. The rule also covers a tender or deposit that the court considers not substantially deficient. The court decides sufficiency.
From which date are mesne profits payable?
Under Rule 10A, the relevant period begins with the institution of the foreclosure suit, provided the statutory conditions are met.
Does Rule 10A prescribe the rate of mesne profits?
No. The amount must be determined on the evidence and applicable legal principles.
Legal information only. The application of this provision depends on the mortgage, evidence, procedural posture and applicable amendments.