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1. The point I have to determine is, whether a valid equitable mortgage by deposit of title deeds has been made between the parties.

2. There is, in the case, an unregisted document, Ex. YI, consisting of a letter addressed by the original defendant No. 4 to the plaintiffs, in the following terms:-

I beg to state the fact that the title-deeds of my immovaable property-situate at Chinchpookly, Bombay, were lodged by me with your bank on May 30, 1919, as guarantor for any possible indebtedness of Messrs. R.C. Nazir & Co.

9. In regard to cases falling under either of these two heads, Sections 91 and 92 of the Indian Evidence Act provide a specific rule of proof: the terms of such contract cannot be proved by any evidence except the document itself, or secondary evidence of it.

10. Secondly, Section 59 of the Transfer of Property Act (IV of 1882) first places all mortgages under the compulsory exception, and then saves an equitable mortgage;

viz.,-if a mortgage is created by delivery to a creditor or his agent of documents of title to immoveable property, with intent to create a security thereon, such a mortgage is not invalid by reason of there being no registered instrument.

13. Thirdly, Sections 17(1)(b), and Section 49 of the Indian Registration Act, read together, provide (so far as now material) that a document "which purports or operates to create, declare, assign, limit, or extinguish any right, title, or interest to or in immoveable property, shall be registered; and shall not affect any immoveable property comprised therein, or be received as evidence of any transaction affecting such property, unless it has been registered."

14. In the result, the exception in Section 59 of the Transfer of Property Act (that there need not be a registered instrument to evidence an equitable mortgage) remains subject to an exception that has a two fold effect. First, that if the terms of the contract relating to the equitable mortgage have been reduced to the form of a document-if the intended equitable mortgage is created by a contract which is reduced to the form of a document-no evidence shall be given in proof of the terms of such contract except the document itself (or secondary evidence of its contents); Indian Evidence Act, Section 91. Secondly, since the object of such a document is to create a security, i.e. it purports or operates to create an interest in immovable property, that document itself shall not affect the property nor be received as evidence unless it has been registered : Indian Registration Act, Sections 17 and 49.

15. The point, therefore, that I have to consider is, whether, in the present case, there was a mortgage made by delivery to the creditor of documents of title to immoveable property with intent to create a security thereon, or whether though such an equitable mortgage by parol may have been in the contemplation of the parties, yet the security was in fact created by a contract reduced to the form of a document (which document would have to be registered).

16. These alternatives are contrasted in all the decisions on the question. Lord Carson, delivering the judgment of the Privy Council in Suhramonian v. Lutchman (1922) L.R. 50 I.A. 77 : s.c. 25 Bom. L.R. 582, refers to the earlier case of Pranjivandaa Mehta v. Chan Ma Phee (1916) L.R. 43 I.A. 122 : s.c. 18 Bom. L.R. 664, which is important for considering how the exception contained in the Transfer of Property Act may be interpreted. The transaction may take one of three forms (p. 82):-