Power of sale when valid
Section 69 of the Transfer of Property Act, 1882 deals with power of sale when valid. ] [ a mortgatee, or any person acting on his behalf, shall, subject to the provisions of this section, have power to sell or ,concur in selling the mortgaged property, or any part thereof, in default of payment of the mortgage -money, without the intervention of the Court, in the following cases and The Act came into force on 01 Jul 1882.
1[(1)] 2[3*** a mortgatee, or any person acting on his behalf, shall, subject to the provisions of this section, have power to sell or ,concur in selling the mortgaged property, or any part thereof, in default of payment of the mortgage -money, without the intervention of the Court, in the following cases and in no others, namely:--]
(a) where the mortgage is an English mortgage, and neither the mortgagor nor the mortgagee is a Hindu, Muhammadan or Buddhist 4[or a member of any other race, sect, tribe or class from time to time specified in this behalf by 5[the State Government], in the Official Gazette;
(b) where 6[a power of sale without the intervention of the Court is expressly conferred on the mortgagee by the mortgage-deed, and] the mortgagee is 7[the Government];
(c) where 6[a power of sale without the intervention of the Court is expressly conferred on the mortgagee by the mortgage-deed, and] the mortgaged property or any part thereof 8[was, on the date of the execution of the mortgage -deed], situate within the towns of Calcutta, Madras, Bombay, 9[*** 10[or in any other town or area which the State Government may, by notification in the Official Gazette, specify' in this behalf.]
11[(2)] 12*** No such power shall be exercised unless and until--
13[(a)] notice in writing requiring payment of the principal money has been served on the mortgagor, or, one of several mortgagors, and default has been made in payment of the principal money, or of part thereof, for three months after such service; or
14[(b)] some interest under the mortgage amounting at least to five hundred repees is in arrear and unpaid for three months after becoming due.
15[(3)] When a sale has been made in professed exercise of such a power, the title of the purchaser shall not be impeachable on the ground that no case had arisen to authorize the sale, or that due notice was not given, or that the power was otherwise improperly or irregularly 'exercised; but any person damnified by an unauthorised, or improper, or irregular' exercise of the power shall have his remedy in damages against the person exercising the power.
16[(4)] The money which is received by the mortgagee, arising from the sale, after discharge of prior incumbrances, if any, to which the sale is not made subject, or after payment into Court under section 57 of a sum to meet any prior incumbrance, shall, in the absence of a contract to the contrary, be held by him in trust to be applied by him, first, in payment of all costs, charges and expenses properly incurred by him as incident to the sale or any attempted sale; and, secondly, discharge of the mortgage-money and costs and other money, if any, due under the mortgage; and the residue of the money so received shall be paid to the person entitled to the mortgaged property, or authorised to give receipts for the proceeds of the sale thereof.
17[(5)] Nothing in this section or in section 69A applies to powers conferred before the first day of July, 1882.]
18* * * * *
Section 69, The Transfer of Property Act, 1882 (Act 4 of 1882).
Cross-references
Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.
This section refers to
Referred to by 8
- Goa, Daman and Diu Irrigation Act s. 98 Repeal
- Goa, Daman and Diu Irrigation Act, 1973 and Rules s. 98 Repeal
- National Dairy Development Board Act s. 31 Special provisions for enforcement of claims by National Dairy Development Board
- National Housing Bank Act s. 36E Application to the recovery officer
- Oil Industry (Development) Act s. 9 Special provisions for enforcement of claims by the Board
- Small Industries Development Bank of India Act s. 41 Special provisions for enforcement of claims by Small Industries Bank
- State Financial Corporations Act s. 31 Special provisions for enforcement of claims by Financial Corporation
- s. 69A Appointment of receiver
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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Rajesh Sanghani and Brothers vs The Yavatmal Urban Cooperative Bank Limited
Court's Decision & Legal Precedent
Cooperative banks registered under State legislation and multiState cooperative societies registered under the MSCS Act, 2002 are engaged in banking business which falls within Entry 45 of List I of the Seventh Schedule of the Constitution of India. Therefore: (1) Cooperative banks are 'banking companies' within the definition of Section 5(c) of the Banking Regulation Act, 1949 as incorporated by Section 56(a) thereof; (2) Cooperative banks are 'banks' under Section 2(1)(c) of the SARFAESI Act, 2002; (3) The notification dated 28.1.2003 and Section 2(1)(c)(iva) of SARFAESI Act added in 2013 are constitutionally valid exercises of Parliament's legislative competence under Entry 45; (4) The Parliament has competence to provide recovery procedures under Section 13 of SARFAESI Act for cooperative banks, and such procedures are an integral part of regulating banking activity; (5) Cooperative banks' organizational aspects (incorporation, management, winding up) remain subject to State regulation under Entry 32 of List II, while their banking activities are subject to Union regulation under Entry 45 of List I, representing permissible dual regulation under the aspects doctrine.
On this section: Referenced regarding enforcement of security interests
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Gehlot Creation vs Union of India
Court's Decision & Legal Precedent
The core holding is that: (1) 'Banking' in Entry 45 of List I of the Seventh Schedule of the Constitution covers the banking activity of cooperative banks, not merely commercial banks; (2) Cooperative banks as defined in Section 56(cci) of the Banking Regulation Act 1949 are included in the definition of 'banking company' under Section 5(c) by virtue of Section 56(a) which operates as incorporation by reference; (3) Recovery of dues is an essential banking function covered by Entry 45; (4) The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act 2002 applies to cooperative banks as it deals with banking recovery procedures under Entry 45, not regulation of cooperative society structure under Entry 32; (5) The notification dated 28.1.2003 specifying cooperative banks as 'bank' under SARFAESI Act is valid exercise of delegated power under Section 2(1)(c)(v); (6) Section 2(1)(c)(iva) amendment inserted by Act 1 of 2013 adding 'multiState cooperative bank' is constitutional and not ultra vires; (7) Parliament has legislative competence to extend banking recovery procedures to cooperative banks as the pith and substance of such legislation is banking regulation under Entry 45, and any incidental encroachment on Entry 32 (cooperative society incorporation/management) is permissible under doctrine of pith and substance.
On this section: Rights of secured creditors to realize security through sale; basis for SARFAESI Act framework of enforcement of security interest
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Wellbert Pharmaceutical (bombay) Pvt. LTD vs Union of India
Court's Decision & Legal Precedent
Banking activity of cooperative banks, whether at state or multiState level, falls within Entry 45 of List I of the Seventh Schedule of the Constitution, making such cooperative banks subject to central banking legislation including SARFAESI Act. The expression 'banking company' in Section 5(c) of the Banking Regulation Act 1949, read with Section 56(a), includes cooperative banks performing banking functions. Parliament has constitutional competence to legislate on recovery procedures for cooperative banks as recovery is essential and integral to banking activity. Section 2(1)(c)(iva) of SARFAESI Act and the notification of 28.1.2003 are constitutionally valid. Cooperative banks remain subject to state law regarding incorporation, regulation and winding up (Entry 32 List II) while their banking activity is regulated by central law (Entry 45 List I).
On this section: Enforcement of security interests; relevance to Entry 6 List III and concurrent jurisdiction arguments
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Mahesh Kumar Sahu vs Malleshwaram Coopoerative Bank LTD
Court's Decision & Legal Precedent
When cooperative banks perform banking activity (accepting public deposits and lending money), such banking activity falls within Entry 45 of List I, irrespective of the cooperative bank's entity structure as a cooperative society falling under Entry 32 of List II. Consequently, (1) cooperative banks are 'banking company' within Section 5(c) of BR Act, 1949 when read with Section 56(a); (2) cooperative banks are 'banks' for purposes of SARFAESI Act, 2002; (3) the SARFAESI Act's recovery procedures under Section 13 are applicable to cooperative banks as recovery is an essential aspect of banking business covered by Entry 45; (4) the notification dated 28 January 2003 and the 2013 amendment to SARFAESI Act are constitutionally valid as Parliament has competence under Entry 45 to legislate on banking activities regardless of the entity structure. The incidental impact on State List matters (cooperative society management) does not invalidate the central legislation under the doctrine of pith and substance.
On this section: Underlying property law framework for security interests that SARFAESI Act supplements
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Kamal Hospitality Pvt. Ltd. Director vs Union of India Ministry of Finance Secretary
Court's Decision & Legal Precedent
Cooperative banks, whether registered under State Cooperative Laws or the MultiState Cooperative Societies Act, when engaged in banking activity, are governed by legislation relatable to Entry 45 of List I of the Seventh Schedule of the Constitution of India. The activity of banking performed by cooperative banks falls within Entry 45 scope regardless of their status as cooperative societies. Accordingly, cooperative banks are covered within the definition of banking company under Section 5(c) Banking Regulation Act read with Section 56(a), and are subject to the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002. Recovery procedures under Section 13 SARFAESI Act are applicable to cooperative banks. Parliament has legislative competence under Entry 45 to extend SARFAESI Act recovery provisions to cooperative banks. The notification of 28.1.2003 and Section 2(1)(c)(iva) inserted in 2013 are constitutionally valid and not ultra vires.
On this section: Enforcement of security interests
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Standard Chartered Bank vs V. Noble Kumar
Court's Decision & Legal Precedent
A secured creditor under the SARFAESI Act has the discretion to choose between two alternative procedures for taking possession of secured assets - either direct possession under Section 13(4) with procedures mandated by Rule 8, or by invoking the assistance of the Magistrate under Section 14 - and need not exhaust one procedure before resorting to the other. The statutory appeal remedy under Section 17 remains available to the borrower after possession is transferred to the secured creditor, regardless of which procedure was employed, ensuring the borrower's right to challenge the measures taken is preserved. Rule 8 procedures are specific to direct creditor possession under Section 13(4) and are not applicable when a Magistrate exercises powers under Section 14, which are instead governed by the Code of Criminal Procedure.
On this section: SARFAESI Act Section 13(1) explicitly provides that secured creditor may enforce security interest notwithstanding these Transfer of Property Act provisions regarding mortgagee's rights.
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Punjab National Bank vs Union of India Ministry of Finance/revenue Thr. Its Secretary
Court's Decision & Legal Precedent
When a statutory rule is omitted from the statute books and replaced by a new rule that uses narrower language or does not provide for the same power, pending proceedings initiated under the omitted rule will lapse unless there is an applicable saving clause in the statute or the new rule. Section 6 of the General Clauses Act applies only to repeal of Central Acts or Regulations, not to omission of rules. Section 38A of the Central Excise Act does not save proceedings when the legislature manifestly does not intend to revive the power, as evidenced by the fact that the power is not re-introduced in subsequent rules and the language is narrowed from 'anything' to 'goods'. Therefore, confiscation orders passed under an omitted rule are without jurisdiction and void. Additionally, in the absence of a specific statutory provision providing first charge to the government, secured creditors under SARFAESI Act have priority over government debts, and SARFAESI Act provisions override all other laws including the Central Excise Act.
On this section: Provides for court intervention in enforcement of security interest; SARFAESI Act provides alternative mechanism without court intervention
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Axis Bank vs Sbs Organics Pvt. LTD
Court's Decision & Legal Precedent
Upon disposal of an appeal under Section 18 of the SARFAESI Act, either on merits or by withdrawal, the mandatory pre-deposit of fifty percent (or reduced amount) of the debt made as a condition precedent for the appellate tribunal to entertain (admit to consideration) the appeal must be refunded to the depositor-borrower in full, unless: (i) the tribunal has appropriated the deposit towards the borrower's outstanding liability with the consent of the depositor, or (ii) the deposit has been adjusted with the consent of the depositor, or (iii) there is lawful attachment on the pre-deposit under Section 13(10) proceedings read with Rule 11 of The Security Interest (Enforcement) Rules, 2002, or any other proceedings known to law. The deposit does not constitute a secured asset or secured debt under the SARFAESI Act, and the secured creditor has no general lien over the deposit under Section 171 of the Indian Contract Act as the deposit is held by the tribunal, not bailed with the bank.
On this section: Cited in SARFAESI Act Section 13(1) to indicate that security interest may be enforced without court/tribunal intervention, distinguishing it from ordinary mortgage enforcement
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Judgments citing this section
These may be obiter dicta or a precedent, for you to study. These are the judgments where this section is quoted.
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… In England a sale of property takes place by agreement but it is not so in our country. The power to sell shall not be exercised unless and until notice in writing requiring payment of the principal money has been served on the mortgagor. Further Section 69(3) of the Transfer of Property Act shows that when a sale has been made in professed exercise of such a power, the right of the purchaser shall not be impeachable on the ground that no case had arisen to authorize the sale. Therefore, until the sale is complete by registration the mortgagor does not lose right of …
Questions about Section 69
What have the courts held on Section 69 of the Transfer of Property Act?
Rajesh Sanghani and Brothers vs The Yavatmal Urban Cooperative Bank Limited (05 May 2020) is the leading judgment on this section among those set out below: Referenced regarding enforcement of security interests. Another 7 judgments on this section are set out below, all of them from the Supreme Court. They run from 2013 to 2022.
How do I find court cases under Section 69 of the Transfer of Property Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: TP Act 69, section 69 TP Act, section 69 of the Transfer of Property Act. People searching for it also type 69 tpa act and sec 69a tpa. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 8 reported judgments on this section are set out on this page, beginning with Rajesh Sanghani and Brothers vs The Yavatmal Urban Cooperative Bank Limited (05 May 2020).
What should I read with Section 69 of the Transfer of Property Act, and has it changed?
Its own text turns on section 69A (Appointment of receiver), so none of them can safely be read on its own. 8 other provisions in this corpus refer back to it.
When did Section 69 of the Transfer of Property Act come into force?
Section 69 of the Transfer of Property Act, cited as TP Act 69, came into force on 01 Jul 1882, having been enacted on 17 Feb 1882. It is in force as at the date shown on this page.
Other sections of this Act
- 55. Rights and liabilities of buyer and seller1096 words
- 108. Rights and liabilities of lessor and lessee1030 words
- 69A. Appointment of receiver892 words
- 3. Interpretation-clause658 words
- 35. Election when necessary614 words
- 58. Mortgage , mortgagor , mortgagee , mortgage-money and mortgage- deed defined554 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Text as in force on 15 Oct 2026. This page is not a substitute for legal advice.