Transfer of Property Act, 1882 · Chapter IV: Of Mortgages of Immoveable Property and Charges · Charges
Section 101: No merger in case of subsequent encumbrance
In plain words
If a mortgagee or charge-holder buys the owner's rights in the property, their mortgage or charge does not merge and disappear as against later mortgagees. A later mortgagee cannot foreclose or sell without first redeeming the earlier mortgage, or subject to it.
A simplified explanation, prepared with AI assistance from the official text below and checked automatically against it for numbers and cross-references. The official text is the law and prevails over this summary. Not legal advice.
Official text
Any mortgagee of, or person having a charge upon, immoveable property, or any transferee from such Mortgagee or charge-holder, may purchase or otherwise acquire the rights in the property of the mortgagor or owner, as the case may be, without thereby causing the mortgage or charge to be merged as between himself and any subsequent mortgagee of, or person having a subsequent charge upon, the same property; and no such subsequent mortgagee or charge-holder shall be entitled to for close or sell such property without redeeming the prior mortgage or charge, or otherwise than subject thereto.]
Source: India Code (indiacode.gov.in), the consolidated text published by the Legislative Department, Government of India. Text as updated on India Code on 15 October 2026. Words in square brackets [ ] were inserted or substituted by later amending Acts, and *** marks words omitted by an amendment. The amendment footnotes are not reproduced here. Official text on India Code.
Supreme Court judgments citing the section 101
No Supreme Court judgment in our database cites this section yet.