Transfer of Property Act, 1882 | Chapter IV - Mortgages

Section 70 - Accession to Mortgaged Property

Section 70 of the Transfer of Property Act, 1882 explains when an increase or addition to mortgaged property becomes part of the security available to the mortgagee. Unless the parties contract otherwise, an accession made after the mortgage also secures the mortgage debt.

Complete text of Section 70

Meaning of accession and mortgage

An accession is an addition or increase to existing property, whether through natural processes or improvements such as construction. Under Section 58, a mortgage transfers an interest in specified immovable property as security for a debt or specified obligation. The mortgagor provides the security, while the mortgagee holds the mortgage interest.

Section 70 means that an addition arising after the date of the mortgage ordinarily becomes part of the mortgage security. It does not mean that the mortgagee automatically becomes the absolute owner of the added property; the mortgagee's entitlement is expressly for the purposes of the security.

Conditions and exceptions

1. There must be a valid mortgage of identifiable property.
2. An accession to that property must occur after the mortgage date.
3. The accession must be connected to the mortgaged property, not an unrelated asset.
4. The rule applies in the absence of a contract to the contrary; the mortgage deed may provide otherwise, subject to applicable law.
5. The mortgagee's right extends to the accession only as mortgage security and remains subject to redemption and other legal rights.

Statutory illustrations explained

Natural accession by alluvion

In illustration (a), a riverside field expands through alluvion, the gradual deposit of soil by the river. The additional land becomes part of the security for the mortgage, assuming it is legally an accession to the mortgaged field.

Building constructed after mortgage

In illustration (b), the mortgagor builds a house on land that was already mortgaged. Both the original land and the subsequently constructed house are covered by the mortgage security under the statutory default rule.

Section 70 compared with Section 63

Section 63 deals with the mortgagor's right, upon redemption, to an accession to mortgaged property in the possession of the mortgagee, subject to its specific conditions. Section 70 addresses the mortgagee's security interest in accessions made after the mortgage. These provisions operate from different perspectives and should be read together with the right to redeem under Section 60.

Practical implications

When property is mortgaged, subsequent buildings, additions and natural increases may enhance the lender's security without the need for a fresh mortgage solely for the accession. The scope depends on the mortgage deed, the legal nature and ownership of the accession, and applicable property law. The mortgagee's remedies remain governed by provisions such as Section 67 (foreclosure or sale), Section 69 (limited power of sale without court intervention) and other relevant laws.

Official source

Read the Transfer of Property Act, 1882 on India Code for the official Act and applicable amendments.

Frequently asked questions

Does a new house built on mortgaged land form part of the mortgage?

Ordinarily yes, under illustration (b) to Section 70, unless a valid contrary contract or other applicable legal rule changes the result.

Does the mortgagee become owner of the accession?

No. Section 70 gives an entitlement to the accession for the purposes of security, not unconditional ownership.

Can the mortgage deed exclude future additions?

Section 70 expressly makes the default rule subject to a contract to the contrary, which must be interpreted in light of applicable law.