1. The plaintiff sued for enforcement of a mortgage, Ex. A, as against the purchaser from the mortgagor. It has been found that there was no consideration for the mortgage. It is argued before us that the motrgage nonetheless subsists, inasmuch as it is a registered transaction, and it has been shown that the transaction was a sham: that as it has not been found that there was any object for this transaction being entered into without having any effect and the charge is already created on the property, it must subsist on it when it is transferred to a purchaser from the mortgagor. Ranga Ayyar v. Srinivasa Ayangar(1) is relied upon for these contentions. There it was said that “when a conveyance has been duly executed and registered by a competent person, it requires strong and clear evidence by justify a Court in holding that the parties did not intend that any legal effect should be given to it. It needs to be proved that both parties had it in their minds that the deed should be a mere sham, and in order to establish this proof, it needs to be shown for what purposes other than the ostensible one the deed was executed.” But these remarks were made, where circumstances were proved, showing that the intention was to pass the title to the property to the wife and daughters of the transferor in order that the next heir of the transferor who was at enmity with him, should be prevented from inheriting the property. Further, it must be pointed out that in that case the Court was dealing with the sales. When the ownership of property is purported to be passed by means of sale and from the attendant circumstances it can be inferred that the ostensible vendor wished to benefit the transferee so that Section 81 of the Trusts Act, does not come into operation, the case may have a very different complexion from where (as in the case before us) what is purported to be done is to create a charge on the property, and there are no circumstances from which it can be inferred that a charge was intended to be created for a higher amount than the consideration which actually passed in order that the mortgagee may benefit by such charge being for the higher amount. The extent of the charge on the property would prima facie be measured by the actual consideration for securing which the charge was created and/when the consideration is found to be nil, the charge prima facie disappears.
2. We are therefore of opinion that on the finding that no consideration passed and in the absence of such circumstances as we have referred to, the decree of the ??? appellate Court dismissing the plaintiff's suit was right.
3. The appeal, will therefore be dismissed with costs.
S.N/R.K
4. Appeal dismissed.