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A mortgagor delivers possession to the mortgagee, who may retain it until the mortgage money is paid…

Section 58(d) describes a usufructuary mortgage. The mortgagor delivers or undertakes to deliver possession, and authorises the mortgagee to keep possession until payment…

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A mortgagor delivers possession to the mortgagee, who may retain it until the mortgage money is paid and apply the rents and profits towards interest or principal. What type of mortgage is this under the Transfer of Property Act, 1882?

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Correct answer C

Section 58(d) describes a usufructuary mortgage. The mortgagor delivers or undertakes to deliver possession, and authorises the mortgagee to keep possession until payment and apply rents or profits towards interest, principal, or both.

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Option A

A simple mortgage under section 58(b) is made without delivery of possession.

Option B

Section 58(e) defines an English mortgage by a promise to repay on a certain date and an absolute transfer subject to retransfer on repayment.

Option C

The authority to retain possession and apply rents or profits is characteristic of a usufructuary mortgage under section 58(d).

Option D

An anomalous mortgage is the residual category in section 58(g). The facts given satisfy the specific definition in section 58(d).

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