Displaced Persons (Debts Adjustment) Act,1951
Act No : 70
Section :
Debts secured on immovable property.
16. Debts secured on immovable property. (1) Where a debt incurred by a displaced person is secured by a mortgage, charge or lien on the immovable property belonging to him in West Pakistan, the Tribunal may, for the purpose of any proceeding under this Act, require the creditor to elect to retain the security or to be treated as an unsecured creditor. (2) If the creditor elects to retain the security, he may apply to the Tribunal, having jurisdiction in this behalf as provided in section 10, for a declaration of the amount due under his debt. (3) Where in any case, the creditor elects to retain his security, if the displaced debtor received any compensation in respect of any such property as is referred to in sub-section (1), the creditor shall be entitled-- (a) Where the compensation is paid in cash, to a first charge thereon: Provided that the amount of the debt in respect of which he shall be entitled to the first charge shall be that amount as bears to the total debt the same proportion as the compensation paid in respect of the property bears to the value of the verified claim in respect thereof and to that extent the debt shall be deemed to have been reduced: (b) Where the compensation is by way of exchange of property, to a first charge on the property situate in India so received by way of exchange: Provided that the amount of the debt in respect of which be shall be entitled to the first charge shall be that amount as bears to the total debt the same proportion as the value of the property received by way of exchange bears to the value of the verified claim in respect thereof and to that extent the debt shall be deemed to have been reduced. (4) Notwithstanding anything contained in this section, where a debt is secured by a mortgage of agricultural lands belonging to a displaced person in West Pakistan and the mortgage was with possession, the mortgagee shall, if he has been allotted lands in India in lieu of the lands of which he was in possession in West Pakistan, be entitled 70 to continue in possession of the lands so allotted until the debt is satisfied from the usufruct of the lands or is redeemed by the debtor: Provided that in either case the amount of the debt shall be only that amount as bears to the total debt the same proportion as the value of the lands allotted to the creditor in India bears to the value of the lands left behind by him in West Pakistan and to that extent the debt shall be deemed to have been reduced. (5) Where a creditor elects to be treated as an unsecured creditor in relation to the debt, the provisions of this Act shall apply accordingly.
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