Deed of Simple Mortgage

            This Deed of Simple Mortgage is made and entered into at________, this____ day of______, 20___, between ABC, an adult Indian, aged about____ years, occ:-business, resident of______________________, hereinafter, for the sake of brevity, referred to as the “Mortgagor” (which expression, unless it be repugnant to the context and meaning thereof, includes his legal heirs, executors, administrators and assigns) and DEF, a Scheduled Co-operative Bank, having branch office at____________ and registered office at_______________, through its Manager Shri_____________________, hereinafter, for the sake of brevity, referred to as the “Mortgagee Bank” (which expression, unless it be repugnant to the context and meaning thereof, includes its legal representatives, administrators, liquidators and assigns);

            WHEREAS, the “Mortgagor” is a businessman carrying on the business of manufacture, sale and distribution of pickles, condiments and other allied products under the name & style of M/s______________.

            AND WHEREAS, the “Mortgagor” desires to expand and diversify his existing business by setting up one more manufacturing facility at___________, with particular emphasis on Farsan and namkin products, requiring a sizable investment.

            AND WHEREAS, “Mortgagor” presently does not have the requisite funds to finance the aforesaid project, he decided to raise the necessary finance through borrowing and with that object in mind he approached the “Mortgagee Bank” at its__________ branch office.

            AND WHEREAS, the loan proposal submitted by the “Mortgagor” was found viable and truthful by the “Mortgagee Bank”, the latter decided to sanction a loan of Rs________/- (Rs____________/-only) in favour of the “Mortgagor” for the business purpose as set out above and more particularly described in the “Loan Agreement” with simple interest @___% p.a

            AND WHEREAS, the “Mortgagee Bank” agreed to sanction the aforesaid business loan against some collateral security, the “Mortgagor” herein decided to mortgage his existing factory at_________, together with all the machinery, tools and stock-in-trade lying at the said factory, which are more particularly described in Schedule of Property appended hereto (hereinafter, for the sake of brevity, referred to as the “Mortgaged Property”) and as the “Mortgagee Bank” accepted the said offer both the parties hereto are proceeding to execute the instant Deed of Simple Mortgage pursuant to the terms and conditions set out herein below.


                        1] The “Mortgagor” herein, in furtherance of the business loan of Rs_____/- (Rs_____________/-only) sanctioned by the “Mortgagee Bank” (the receipt whereof he hereby acknowledges under the Acknowledgment Receipt appended hereto), mortgages unto and in favour of the “Mortgagee Bank” the “Mortgaged Property” comprised in the Schedule of Property towards security for the payment of the aforesaid loan.

                        2] The “Mortgagor” herein promises and undertakes to pay the business loan of Rs________/- (Rs___________/-only) together with simple interest @_____% p.a on or before____________ (hereinafter, for the sake of brevity, referred to as the “Mortgage Money”) and further agrees that in the event of his failure to pay the “Mortgage Money” by the aforesaid date, the “Mortgagee Bank” shall be entitled to recover the “Mortgage Money” by the attachment and sale or sale of the “Mortgaged Property” and to apply the sale proceeds thereof in defraying the “Mortgage Money” together with all the reasonable expenses of litigation and execution. The “Mortgagor” agrees that in the event of any shortfall or deficiency in the sale proceeds vis-à-vis the “Mortgage Money”, he and his estate shall be liable to satisfy the remainder of the claims of the “Mortgagee Bank”. The “Mortgagee Bank” on its part agrees that in the event of the amount of sale proceeds exceeding the “Mortgage Money” and the recovery charges, the “Mortgagor” shall be entitled to the surplus money.

                        3] The “Mortgagor” assures the “Mortgagee Bank” that he is the bonafide and absolute owner of the “Mortgaged Property” and the same is free from any charge, lien or encumbrances of any kind. The “Mortgagor” further assures the “Mortgagee Bank” that he has not done any act, deed or thing which could preclude him from mortgaging the “Mortgaged Property” or any part thereof, in favour of the “Mortgagee Bank” and that the same is capable of being charged and assured for the repayment of the “Mortgage Money”.

                        4] The “Mortgagor” and the “Mortgagee Bank” both declare and confirm that the “Mortgaged Property” has been valued by a Government Approved Valuer to the satisfaction of the latter. The “Mortgagor”, on his part, agrees and undertakes that he shall not sell, lease, mortgage or let out the “Mortgaged Property” nor shall he create any third party interest therein inimical to the interests of the “Mortgagee Bank” during the subsistence of the said mortgage. The “Mortgagor” further agrees to maintain the stock-in-trade at the level existing on the date of these presents.

                        5] The “Mortgagee Bank” hereby agrees that the “Mortgagor” shall have the right to redeem the “Mortgaged Property” by repaying the “Mortgage Money” on or before_______, and on such payment being made the mortgage shall be deemed to have been redeemed and thereupon all the rights which the “Mortgagee Bank” might have acquired under this mortgage deed shall lapse and revert back to the “Mortgagor”



            IN WITNESS WHEREOF, the parties hereto have appended their respective hands to this writing on the day, month and year first hereinbefore mentioned.

Signed, sealed and delivered

by ABC, the withinnamed

“Mortgagor” in the presence of





                                                            The Mortgagor


Signed, sealed and delivered

by DEF, the withinnamed

“Mortgagee Bank” in the presence of





Manager of DEF

                                    The Mortgagee Bank


Acknowledgment Receipt

            This is to acknowledge that I have  received a sum of Rs_____/ (Rs___________/-only) from DEF, the “Mortgagee Bank” for the purpose of business loan as described hereinabove, by a Banker’s cheque dated____, bearing No_____, issued by the Manager of _________ Bank,____ Branch and the same has been duly realised.




I say received,


The Mortgagor



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