[REPORTABLE]

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.3625 of 2006

New Okhla Industrial Development Authority (NOIDA)                    …..APPELLANT

Versus

Army Welfare Housing Organization   & Ors.                          ….RESPONDENTS

WITH CIVIL APPEAL NOs.2938/2005, 2939/2005,

2941/2005, 2942/2005, 2943/2005, 2945/2005,  2944/2005, 3607/2006, 3605/2006, 3621/2006,  

3618/2006, 3608/2006, 3604/2006, 3606/2006 and  3603/2006  

J U D G M E N T

HARJIT  SINGH  BEDI, J.

1. These appeals are directed against the Judgment of the  

Division  Bench  of  the  Allahabad  High  Court  dated  14th  

October,  2004  whereby  the  writ  petition  filed  by  the  

respondents herein has been allowed and the letters issued by  

New  Okhla  Industrial  Development  Authority  (hereinafter  

called  the  ‘NOIDA’)  dated  13th November,  2002  and  7th  

January, 2003 have been quashed.  Aggrieved by the decision

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of the Division Bench, the respondents in the High Court are  

the appellants before us.  

2. The facts leading to these appeals are as under:-

3. The  writ  petitioners-respondents,  Societies  registered  

under the Societies Registration Act, 1860 namely The Indian  

Railway  Welfare  Organization  (IRWO),  the  Air  Force  Naval  

Housing  Board  (AFNHB),  the  Army  Welfare  Housing  

Organization (AWHO) and several others filed writ petition in  

the Allahabad High Court impugning the letters/notices dated  

13th November, 2002 and 7th January, 2003 and other similar  

notices by which NOIDA had directed the individual members  

of the Housing Societies to execute tripartite deeds, the other  

two parties  being the  Housing Societies,  as the  lessee,  and  

NOIDA, as the lessor, for the sale of the super-structure which  

had been built on the land allotted to these Societies and for  

further  restraining  the  State  Government,  Noida  etc.  from  

charging any stamp duty on the execution of the deeds.  The  

petitioners also pleaded that the land had been allotted to the  

Societies by NOIDA and that the super-structure thereon had  

been built solely on the contributions made by the individual  

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members as the said Societies did not have any corpus of their  

own.  It was further pointed out that the buildings had been  

constructed in a phased manner over a period of time and, the  

Societies being the lessees of the land in question were not the  

owners  of  the  super-structure  so  as  to  bind  the  individual  

members to the covenants that had been subscribed to by the  

Societies  with  NOIDA the  lessor.  It  was  further  highlighted  

that NOIDA had not contributed anything towards the cost of  

construction  of  the  super-structures  and that  the  only  role  

performed by it was the sanctioning of the building plans and  

the directions to execute tripartite  deeds for  the sale of  the  

super-structure of the residential units or sub-leases for the  

land, was a superfluous exercise,  which was not backed by  

any statutory authority, or contractual obligation the more so  

that it did not fall in the definition of sale under Section 54 of  

the Transfer of Property Act, 1882.  The basic argument was  

that the petitioners could not be compelled to buy something  

which was already their own.

4. The  stand  of  the  writ  petitioners  was  controverted  by  

NOIDA and several pleas were raised.

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5. It was submitted that a writ petition directed against the  

issuance of  a  notice  was not  maintainable  and that  as the  

dispute in effect was as to the terms of a contract, it could not  

be adjudicated upon by the High Court in its writ jurisdiction  

under Article 226 of the Constitution.   

6. It  was  submitted  on  merits  that  the  petitioners  had  

consented  to  the  execution  of  tripartite  deeds  and that  the  

lease deeds entered into between the NOIDA and the Societies  

clearly stipulated that a sub-lease would be executed between  

the  Societies  and  the  members/allottees  and  that  the  sub-

lessees herein above referred had to abide by the terms and  

conditions  of  the  lease  deed.   It  was  pleaded  that  the  

provisions of  the Uttar  Pradesh Industrial  Development Act,  

1976 (hereinafter called the ‘1976 Act’)  were binding on the  

sub-lessees  and  that  the  costs  of  the  stamp  duty  and  

registration  charges  were  to  be  borne  by  them  and  that  

Section  7  and  14  when  read  together  provided  for  the  

resumption of a site in case of a breach of a condition of the  

lease or sub-lease.

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7. The  State  of  U.P.  supporting  NOIDA,  pleaded that  the  

members of  the Societies  had sub-leased the land from the  

Societies on the terms and conditions settled between them  

and as the land had been taken on lease by the Societies from  

NOIDA and the consideration had been paid by the Societies  

in advance the transactions were liable to stamp duty under  

Sub-Section (6) of Section 2 of the Stamp Act 1899 and that a  

tripartite deed envisaged between the parties was chargeable  

to stamp duty on the proportionate cost of the land as well as  

the cost of the super-structure built thereon.

8. The  High  Court  examined  the  various  aspects  raised  

before  it  and  concluded  that  a  distinction  had to  be  made  

between contracts entered into between two private individuals  

and a contract where one of the parties was the State, or an  

instrumentality of the State, and that in the first mentioned  

case no writ would lie in relation to such a contract and the  

parties would have to be relegated to the civil court.  It further  

held that in the latter case, it would be open to the High Court  

to entertain the writ petition and to examine as to whether any  

constitutional  provision  has  been violated  more  particularly  

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where a claim was made that the State or an instrumentality  

of  the  State  respondent  was acting in a discriminatory  and  

arbitrary manner.

9. In  this  background,  the  Division  Bench  observed  that  

admittedly the land have been taken on lease from NOIDA by  

the Societies on which the individual members had built their  

houses on the basis of contributions made by the individual  

members as the Societies themselves did not have any corpus  

of funds.  It further pointed out that the flats/apartments had  

been  constructed  by  the  Societies  on  a  self-financing  

arrangement  under  which  the  construction  of  the  super-

structure was paid for in installments by the allottee members  

and in this view of the matter, there was no sale of the super-

structure in favour of  the members and the demand raised  

thereby  on  the  basis  of  the  two  notices  was  arbitrary  and  

unreasonable and violated Article 14 of the Constitution.  The  

Division  Bench  also  supported  its  findings  by  referring  to  

several judgments of this court.

10. The Court then went into the merits of the controversy  

and observed that the lease deeds executed by NOIDA with the  

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various Housing Societies which were the writ petitioners, the  

basic  covenants  were  the  same  and  related  primarily  to  

paragraphs  2  to  4  and  12  to  14  and  the  Societies-writ-

petitioners  represented  the  interests  of  the  members  

collectively and that the members were bound by the terms of  

the bye-laws of the Societies which postulated that the land  

allotted to the Societies would be handed over to the Societies  

for the construction of flats/apartments and on the basis of a  

lease deed executed between NOIDA and the Societies only.   

11. The Court collated the various paragraphs of the lease  

deed and held that they referred only to the transfer of the  

land and there was no reference whatsoever that the building  

constructed thereon at a later stage would also be treated to  

have been demised by the lessor. The Court also observed that  

the provisions of Section 108 (h) of the Transfer of Property Act  

that the building also belonged to the owner of the land was  

not  applicable  to  India  in  the  light  of  the  various  

pronouncement of this court and various High Courts as well.

12. The court, in conclusion, observed that in the light of the  

aforesaid facts, NOIDA could not compel the Societies or the  

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individual members of the Societies to execute tripartite sub-

leases in terms of the notices and observed as under:

“The  allottee  members,  as  owners  of  the  flats/apartments,  built  from  the  contributions  made  by  these  persons  cannot  be  compelled  to  purchase  it  from  the  society.   It  amounts  to  compelling  a  full  owner  of  the  flat/apartment  to  purchase the property already owned by him, from  the society of which he is a member and to which  it  had  contributed  for  purchase  of  and  for  construction of building.  Such a transfer will be  fictitious  and  involuntary,  and  thus  a  void  transaction under the Indian Contract Act.  It will  be  neither  a  sale  under  section  54,  nor  a  lease  under Section 105 for the Transfer of Property Act  1882”

13. The  Writ  Petitions  were  accordingly  allowed  in  the  

following terms:

“All  the  writ  petitions  are  consequently  allowed.  The  impugned  notices  published  and  issued  by  NOIDA and its officers, directing the petitioners to  enter into the tripartite deeds are set aside.  The  NOIDA and other respondents are restrained from  compelling the petitioners to execute the tripartite  sale deed of super structure of flat and sub lease  deed of land, and from requiring payment of any  stamp  duty  and  registration  fees  on  such  documents.  No order as to costs.”

14. Mr.  K.K.Venugopal,  the  learned  senior  counsel  for  the  

appellants, has made several submissions before us.  He has  

first pointed out that the observation of the Division Bench in  

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the High Court that there was no provision for the execution of  

a  tripartite  deed  under  the  lease  deed  executed  between  

NOIDA and the respondent AWHO was contrary to the record  

as several clauses of the lease deed read cumulatively clearly  

visualized  the  execution  of  tripartite  deed featuring  NOIDA,  

AWHO and the individual sub-lessees.  He also pleaded that  

Section 17(1)(d) of the Registration Act, 1908 when read with  

Section 105 of Transfer of Property Act, 1882 clearly visualized  

the registration of a lease or sub-lease and Section 49 of the  

Registration  Act  dealt  with  the  consequences  of  non-

registration.   He  further  pointed  out  that  a  lease  executed  

included a sub-lease as per Section 107 of Transfer of Property  

Act  and such a document required compulsory registration.  

He  has  also  submitted  that  in  the  absence  of  a  registered  

document, any document purporting to be a lease would be a  

mere waste paper, as held by this Court in  Lachhman Dass  

vs. Ram Lal 1989 (3) SCC 99.  It has also been pleaded  that  

Entry 35 © of  Schedule I B of the Stamp Act as applicable to  

the  State  of  Uttar  Pradesh postulated that  stamp duty was  

payable not only on the land but on the super-structure as  

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well and the findings of the High Court to the contrary were,  

therefore, not maintainable.  It has also been submitted that  

Section 2(g) of the 1976 Act postulated the need for a tripartite  

deed  between NOIDA,  AWHO and the  sub-lessees  and that  

NOIDA’s authority to issue the impugned instructions flowed  

from Section 6 thereof.  It has also been pointed out that the  

AWHO had, during the course of this litigation and even before  

had taken conflicting stand as in the affidavit of Col. Upal of  

October  2007,  it  had been specifically  deposed that  a  sub-

lease was contemplated in the lease deed executed between  

NOIDA and AWHO and that in a letter from the AWHO to Brig.  

Gur Dyal dated 19th of June 1990 it had been specified that a  

tripartite document was to be executed and a specimen of the  

document was also enclosed along with the letter.  It has been  

highlighted that thereafter AWHO had taken a volte face and  

in the affidavit filed by Col. Sabharwal, a contrary stand had  

been taken that  a  tripartite  deed was not  visualized  in  the  

lease  deed  executed  between  NOIDA  and  AWHO.   It  has,  

accordingly,  been  pointed  out  that  on  account  of  this  

confusion  and  other  reasons  a  large  number  of  individual  

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members, that is sub-lessees, had in fact executed tripartite  

deeds, as required by the instructions.  In the rejoinder filed  

by  NOIDA,  the  fact  that  the  respondents  had  been  taking  

shifting  stands  has,  once  again,  been  highlighted  and  as  

further evidence of this fact, attention has again been drawn  

by  Mr.  K.K.Venugopal  to  the  affidavit  of  Col.  Sabharwal  of  

January  2008  wherein  the  affidavit  of  Col.  Upal  has  been  

completely disowned.   

15. Mr.  Anand  for  the  respondents  has,  however,  

controverted the stand taken by the appellants.  It has been  

pointed  out  that  the  land  had  been allotted  to  AWHO and  

other Societies and the Societies formed by members of the  

Defence  Services  had  been  exempted  from  the  payment  of  

stamp duty on the premium for the lease whereas in the case  

of  Societies  set  up of  civilians,  stamp duty had been made  

leviable  and  had,  in  fact,  been  paid,  and  there  was  no  

justification  now,  after  15  years  from  the  allocation  of  the  

land, that the AWHO and sub-lessees had been called upon to  

execute a tripartite document and also to pay stamp duty and  

registration charges.  He has also pointed out that the lease  

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deed  between the  NOIDA and AWHO pertained  only  to  the  

land and had nothing to do with the super-structure and as  

the  residential  building  on  the  land  had  been built  by  the  

lessees themselves, they could not be called upon to execute  

tripartite deeds along with NOIDA and AWHO.  The learned  

counsel has also referred to several clauses of the lease deed  

executed between the NOIDA and AWHO in support  of  this  

plea. He has further submitted that a society registered under  

the Societies Registration Act was not a body corporate or a  

juristic  person and its membership could not be said to be  

distinct from the society and as such there is no question of  

transfer of property from the AWHO to its members.  In this  

connection Mr. Anand has relied upon Illachi Devi & Ors. vs.  

Jain Society, Protection of Orphans India & Ors. 2003 (8)  

SCC 413.

16. We  have  considered  the  arguments  advanced  by  the  

learned  counsel  for  the  parties.   At  the  outset,  it  must  be  

pointed out that some of the arguments that have been raised  

by the learned counsel were not urged, or if urged, were not  

dealt with by the High Court.  The High Court has, in fact,  

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proceeded  primarily  on  the  interpretation  to  be  put  on  the  

lease deed executed between NOIDA and AWHO and has been  

influenced also by the fact that as the structures on the land  

allotted to AWHO had been built by the sub-lessees, and as  

the structures belonged to them the question of any further  

transfer by way of sub-lease as per a tripartite deed was not  

envisaged.   It  is  this  background,  we  have  examined  the  

arguments raised by the learned counsel.            

17. NOIDA has been set up under the provisions of the 1976  

Act.   Section  2(a)  thereof  defines  amenities  which  include  

roads, water supply,  street  lighting,  power supply,  sewerage  

and sub-clauses (d), (e) and (f) deal with the provision of basic  

infrastructure  for  industrial,  commercial  and  residential  

purposes whereas Section 6 (2)  deals with the obligation of  

NOIDA towards the land development of the area.  Section 7  

authorizes NOIDA to transfer the land by way of sale, lease or  

otherwise whether by auction or allotment on such terms and  

conditions, as it may think fit to impose.  Sections 13 and 14  

provide for the imposition of a penalty and mode of recovery of  

arrears  and  resumption  of  the  property  for  breach  of  

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conditions of transfer and Section 17 gives overriding effect to  

the 1976 Act vis-à-vis  other statutes.   It  is  the case of  the  

appellants that the impugned notices were envisaged under  

the  lease  deed  between  NOIDA  and  AWHO  as  well  as  the  

aforesaid provisions of the 1976 Act and for the AWHO and  

the sub-lessees to contend that they could not be called upon  

to  execute tripartite  deeds was,  therefore,  not  acceptable.    

18. We have perused the lease deed executed between NOIDA  

and AWHO.  We reproduce herein below some of the relevant  

clauses.  The lease deed which is for a period of 99 years itself  

indicates that the lessees had agreed to the allotment of the  

land  on  lease  for  the  purpose  of  constructing  residential  

buildings for its members.  Clause 3(b), 3(c), 5, 7, 8, 10, 11  

and 12 are reproduced below:-

“3B. That the lessee shall in no case assign  relinquish  (except  in  favour  of  the  lessor),  let  transfer or part with possession of the demised  premises except by way of sub-lease as provided  in this lease to the Cooperative Society of the  members or directly to the individual registered  member of the lessee whose list will be provided  to  the  lessor  within  three  months  of  such  transfer.  Any subsequent transfer will be made  by the members with prior concurrence of the  AWHO/Co-operative  Society  and  NOIDA  and  

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will  be  subject  to  condition  of  payment  of  transfer charges as levied from time to time but  subject to a maximum of 25% of the unearned  increase in the value of land.

3C.  This  lease  deed  will  form  part  of  sublease  executed  between  AWHO  and  Cooperative  Society  or  to  individual  members.  All conditions contained herein binding on the  sub-lessees also.

5. The lessee shall construct the building  (group housing pockets) on the demise premises  in  accordance  with  the  plan  elevation  and  design and in a position to be approved by the  lessor or any officer authorized by the lessor in  that  behalf  in writing  and in  accordance  with  the building regulations or direction existing or  to exist in future.

The lessee shall be required to commence  construction  of  flats/houses  within  one  year  from the date of possession letter and complete  the same within a period of 7 years extendable  to 10 years from the date of possession failing to  which  the  lease  shall  be  revoked  and 10% of  amount  deposited  shall  be  forfeited  and  possession  of  the  plot  and structures  thereon  unless  removed  by  the  lessor  within  time  specified by the lessee may be taken over by the  lessor  and  lessee  will  not  be  entitled  to  any  compensation.

7. That the lessee will obey and submit to  all direction issued or regulations made by the  lessor now existing or hereinafter to exist so far  as the same are incidental to the possession of  immovable property or so far as they effect the  health or convenience of the other inhabitants  or the place.

8. That the lessee will  at  his own cost  erect  on  the  demised  premises  in  accordance  with  the  plans,  deviation  and  design  to  be  approved by the lessor or any other authorized  

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by the lessor in that behalf in writing and in a  substantial  and  workman  like  manner,  a  building only with all necessary, sewers, drains  and  other  appurtenances  according  to  the  directions issued or regulations made in respect  of  buildings,  drains,  latrines  and  connection  with sewer.

10.  That  the  lessee  will  not  make,  or  permit to make, any alteration in or additions to  the said buildings or other erections for the time  being on the demise premises erect, or permit to  be  erected  any  new  building  in  the  demised  premises  without  the  previous  permission  in  writing of the lessor and except in accordance  with the terms of such permission and the land,  if  any,  approved  by  the  lessor  or  any  officer  authorized by the lessor or in that behalf and in  case of any deviation from such terms or plan,  will immediately upon receipt of notice from the  lessor or such requiring him to do, correct such  deviation for the space of one calendar month  after  the   receipt  of  such  deviation  to  be  corrected  at  the  expenses  of  the  lessee  which  expenses the lessee hereby agrees to reimburse  by  paying  to  the  lessor  such  amount  as  the  lessor (whose decision shall be final) shall fix in  that behalf.

11. That the lessee shall use the demised  premises only for the purpose of constructing a  building  for  housing  its  members  and  for  no  other purpose.

12.  That  the  lessee  shall  not  assign,  transfer, relinquish (except in favour of lessor)  sublet or otherwise part with  possession of the  demised  premises  or  any  part  thereof  or  the  house constructed thereon or any part thereof,  except  first  to  Co-operative  Society  of  its  members  and  then  to  or  individual  members,  without  the  previous  permission  in  writing  of  the lessor.

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Provided that the lessee may be permitted  by the lessor to create a mortgage for purposes  of  securing  loan  from  State  Central  Government/Life  Insurance  Corporation,  Scheduled  Bank/Housing  Board/HUDCO  and  similar  statutory  bodies  and  in  that  case  the  right to mortgages shall be as may be provided  in  the  deed  of  mortgage,  accrue  to  such  institution  subject  to  NOIDA  retaining  first  charges for recovery of ground rent and other  dues, taxes and charges.”  

19. A perusal of the aforesaid clauses would reveal the very  

starkly patent fact that most of the covenants place obligations  

on  the  lessees  as  well  as  on  the  sub-lessees  and  if  the  

covenants  are  in  any  manner  violated,  the  lease  would  be  

liable for forfeiture under Section 14 of the 1976 Act.  We may,  

in particular, highlight sub-clause 3B and 3C which says that  

the conditions of the lease deed will be binding on the sub-

lessees  as  well.  Clause  5  provides  that  the  lessees  shall  

construct the building on the allotted land in accordance with  

the plan, elevation and design to be approved by the lessor  

and  further  that  the  lessee  shall  be  required  to  commence  

construction within the period of one year from the date of  

possession.  Clause 8 further clarifies that the lessees would  

erect  the  building on the  basis  of  the  approved design and  

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Clause  11  once  again  reiterates  that  the  demised  premises  

shall be used by the lessee only for construction of buildings,  

offices and houses for no other purposes whereas Clause 12  

stipulates that the lessee AWHO will not transfer etc. or part  

with  the  possession  of  the  demised  premises  or  the  house  

constructed thereon except first to the Cooperative society or  

its  members  and  then  to  individual  members  without  the  

previous  permission  of  the  lesser  in  writing.   Clause  15  

stipulates that on the breach of the conditions of the transfer  

by the lessee or any other person claiming through or under  

him, it will be open for the lessor i.e. NOIDA to re-enter the  

demised premises to determine the lease.  It would be clear  

from a reading of these provisions that the sub-lessees have  

been fastened with several  obligations vis-à-vis  the demised  

premises  and  further  more,  even  more  significantly,  the  

obligation  lies  on  the  lessees  to  construct  the  buildings  or  

flats,  as the  case may be,  at  their  own cost  and thereafter  

transfer the same to individual members i.e. the sub-lessees.  

It  is  extremely  significant  that  paragraph  69  of  the  Master  

Brochure of July 1987 issued by the AWHO, as amended up to  

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May 2007 reads as under:-    

“69. Organization may at its discretion on a  written  request  from  the  Allottee,  give  possession  on  such  conditions  as  it  may  stipulate  before  instruments  of  transfer  are  executed and registered.”

20. We are, therefore, of the opinion that in this background  

the impugned notices  postulating the  execution of  tripartite  

deeds  flows  not  only  from  the  clauses  of  the  lease  deed  

executed between the  NOIDA and AWHO but also from the  

supervisory authority which is placed on NOIDA by virtue of  

the provisions of Section 7 of the 1976 Act.  The observation of  

the High Court that the structures built on funds provided by  

the  sub-lessees  is  to  our  mind  of  no  consequence.   Even  

assuming  that  such  was  the  position,  this  was  an  

arrangement inter-se AWHO and its members and would not  

detract  from the  obligations placed on AWHO and the sub-

lessees to execute tripartite deeds.  We, however, see from the  

above facts that the question as to whether the sub-lessees  

had themselves constructed the structures is itself in doubt.  

In the affidavit of Col. Upal it has been specifically mentioned  

that  the  funds  of  the  organization  were  raised  by  AWHO  

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mainly  from the  advances/deposits  of  the  allottees,  as  also  

from the borrowings from financial institutions and that the  

respondent organization i.e. AWHO therefore constructed the  

dwelling units with the funds contributed by the allottees and  

also funds raised on loan from the financial institutions.  In  

paragraph 9 of the aforesaid affidavit, it is deposed by Col.Upal  

as under:     

“Upon completion of the housing  project  the  respondent  organization  then  forms  a  “user  committee”  of  the  allottees  who  subsequently  form  a  ‘registered  maintenance  society’  for  the  maintenance  and  upkeep  of  the  common  areas  and  amenities  of  the  housing  project.  The  registered  maintenance  society  of  the  allottees  so  formed  is  then  given  the  common  area  maintenance  funds  as  collected  by  the  respondent  organization  during the payment of installments towards  the cost of the development of their dwelling  units.  Thereafter,  as  and  when  the  allottee(s)  desire  to  have  a  registered  title  deed of the dwelling unit executed in their  favour,  the  respondent  organization  registers  the  same  as  per  the  terms  and  conditions of the land allotting agency and  office of the sub-registrar upon payment of  the  required  stamp  duty  and  registration  charges payable by the allottee.”  

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21. As  already  indicated  above,  the  above  meaningful  

admission was sought to be explained away in the subsequent  

affidavit  of  Col.  Sabharwal  wherein  (in  paragraph  5)  he  

contradicted the affidavit of Col. Upal by stating that all the  

expenses involved in the procurement of land on lease hold  

basis, payment of lease costs, lease rent, construction cost of  

dwelling units, the common amenities and salary required etc.  

were met from the contributions made by the allottees of the  

housing  scheme  and  some  loans  to  procure  land  from the  

Government of India or the General Branch of the Army Group  

Insurance Scheme had been taken and that the interest on the  

loans and the principal amounts had been refunded from the  

contribution  made  by  the  allottees.   It  has,  however,  been  

admitted  that  in  the  year  1989-90  several  allottees  had  

approached AWHO for execution of sub-leases of their dwelling  

units, and the respondent AWHO under the impression that  

stand of NOIDA was bona fide and legally correct had under  

mistaken advice directed the execution of the tripartite deeds.  

In other words, it has been admitted that a large number of  

allottees had executed the tripartite deeds, as required by the  

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impugned  notices.   Col.  Sabharwal  has,  accordingly,  in  a  

manner, sought to distance AWHO from the letter issued on  

behalf  of  AWHO to  Brig.  Gur  Dyal.    It  is  significant  that  

despite  requests  to  AWHO,  no  record  was  produced  to  

substantiate  the  plea,  that  the  super-structures  had  been  

constructed by the allottees at their cost.  We are, therefore, of  

the  opinion  that  the  Division  Bench  to  have  held  that  the  

structures  had  been  built  exclusively  by  the  allottees  and  

therefore they were deemed to be the owners of the structures,  

is on uncertain ground.  In this background, we are not called  

upon to examine the constitution and charter of AWHO or the  

purpose of its being set up, though a great deal of time and  

energy had been expended on this aspect.

22. It is also evident from the reply of Col. Upal (Paragraph  

10) that AWHO had constructed the dwelling units in NOIDA  

and the draft bipartite sub-leases for the transfer of dwelling  

units to the allottees had been submitted by AWHO to NOIDA  

on  4th April  1989  and  pursuant  thereto  the  registration  of  

tripartite documents had commenced.  In the affidavit it has  

further been deposed that no stamp duty had been charged on  

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the  lease  deed  in  favour  of  AWHO  and  stamp  duty  was  

proposed to be charged for the first time on the execution of  

the tripartite deeds and that though the allottees were entitled  

to the ownership of land and structure, but the same would be  

conveyed to the individual allottees only on the execution of  

the registered and stamped documents, as per the provisions  

of  the  Registration  Act,  the  Stamp Act  and the  Transfer  of  

Property Act.

23. It  has also been submitted by Mr.  Venugopal  and Mr.  

Sunil  Gupta,  the  learned  senior  counsel  for  the  appellants,  

that the payment of stamp duty and the registration of the  

tripartite deeds were essential as per the Stamp Act and the  

Registration  Act.   The  learned  counsel  have  referred  us  to  

Section 2(16) and Entry 35 of the Stamp Act.  Section 2(16)  

reads as under:

Sec.2(16).  “Lease”  means  a  lease  of  immovable property, and includes also –

(a) a patta; (b) a  Kabuliyat  or  other  undertaking  in  

writing, not being a counterpart  of a  lease,  to cultivate,  occupy,  or pay or  deliver rent for, immovable property;

(c) any instrument by which tolls of any  description are let;

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(d) any  writing  on  an  application  for  a  lease  intended  to  signify  that  the  application is granted.”

Item 35 of Schedule I calls for the payment of stamp duty on  

leases and sub-leases.  This fact was not seriously disputed by  

the learned Counsel for the respondents.  In the background  

of this Statutory provision, it is not open for the respondents  

to say that stamp duty was not payable.   

24.  Mr.  Anand,  has  however,  submitted  that  a  society  

registered under the Societies Registration Act was not a body  

corporate or a juristic person and the society i.e. AWHO and  

its members were one entity and there was, accordingly, no  

question of transferring by way of sub-lease any property from  

the AWHO to the sub-lessees.  This argument to our mind is  

without force in the light of what has been held above and that  

in the case of Brig. Gur Dyal the stand taken was that the  

sub-lessees should execute a document directly with NOIDA  

bypassing  AWHO,  as  that  was  deemed  to  be  the  right  

procedure.   Mr.  Anand’s  reliance  on  Illachi  Devi  case is  

misplaced for  the  simple  reason as no ownership  has been  

transferred to the cooperative society i.e. AWHO by NOIDA.  In  

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this background it must be held that word ‘vest’ in Section 5 of  

the Societies Registration Act does not envisage a lease deed  

and the matter would, if at all, be covered by Section 5 A, an  

amendment  pertaining  to  the  State  of  Uttar  Pradesh  alone  

which provides:

“Sec.5A.  Restriction  on  transfer  of  property.  –  (1)  Notwithstanding  anything  contained  in  any  law,  contract  or  other  instrument to the contrary, it shall not be lawful  for  the  governing  body  of  a  society  registered  under this Act or any of its members to transfer,  without the previous approval of the court, any  immovable  property  belonging  to  any  such  society.

(2)  Every  transfer  made  in  contravention of sub-section (1) shall be void.”

25. We are, however, not inclined to examine the implication  

of Section 5A for the simple reason that many of those who are  

likely to be affected by its interpretation are not parties to the  

Writ Petition.   

26. Mr. Gupta has, further, submitted that a Society was a  

legal entity in law distinct from its members as the property  

vested  in  living  members,  Trust  or  Board  and as  such the  

Society could hold property, although it may not be a juristic  

person.   For this argument, Mr. Gupta has placed reliance on  

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Board  of  Trustees,  Ayurvedic  and  Unani  Tibia  College,  

Delhi vs. State of Delhi AIR 1962 SC 458.   In this case, the  

Constitution Bench was dealing with Sections 5 and 6 of the  

Societies Registration Act and the question as to whether the  

Tibia College Board set up under the Tibia College Act, 1952  

was a Corporation in Law.  The Bench held that the Board  

was, indeed, not a Corporation but had the characteristics of a  

quasi-Corporation and though a registered society could not  

hold property but a quasi-Corporation would be deemed to be  

separate legal entity and entitled to hold property.   We are,  

therefore, of the opinion that AWHO though registered under  

the Societies Registration Act has certain characteristics which  

would enable it to hold property and therefore transfer of the  

land cum super-structure would be by way of a sub-lease from  

the lessor i.e. NOIDA to the lessee which is the AWHO to the  

sub-lessees  who  are  the  individual  allottees,  by  way  of  a  

stamped and registered document.

27. It has also been submitted by the learned counsel for the  

appellant that registration of a tripartite deed was mandatory  

as per the provisions of Section 17(1)(d) of the Registration Act  

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read with Section 107 of the Transfer of Property Act.  It has  

been pointed out that the Law Commission had highlighted  

the importance of the registration of documents and in this  

connection reference has been made to the 13th Report of the  

Law Commission.  Paragraph 14 thereof reads as under:

“From  this  brief  survey  of  the  provisions  of  the  Act  it  is  clear  that  the  object of the Registration Act is to preserve  an  authentic  record  of  the  terms  of  documents so that if a document be lost or  destroyed  or  misplaced,  a  certified  copy  from  the  register  can  be  obtained.  Registration  also  facilitates  the  proof  of  execution of a document as its execution is  admitted by the executant, before the Sub- Registrar.  Yet  another useful  purpose that  registration serves is to enable any person  intending  to  enter  into  any  transaction  relating  to  immovable  property  to  obtain  complete information relating to the title to  such property and for the purpose to look  into the register and obtain certified copies  of the documents.”

28. Our attention has also been drawn to Section 49 of the  

Registration Act which talks of the effects of non-registration  

of documents required to be registered and provides inter-alia  

that non-registration of such a document would not affect any  

immovable  property  comprised  therein,  or  be  received  as  

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evidence  of  any  transaction  affecting  such  property.   In  

Lachhman Dass’s case (supra) it has been held that a non-

registered sale deed would be a paper transaction having no  

effect in transferring or creating any rights in the sub-lessees.  

It has been observed thus:

“The real  purpose of  registration  is to secure that every person dealing with  the  property,  where  such  document  requires  registration,  may  rely  with  confidence  upon statements  contained in  the register as a full and complete account  of  all  transactions by which title  may be  affected.  Section 17 of the said Act being a  disabling  section,  must  be  construed  strictly.  Therefore,  unless  a  document  is  clearly brought within the provisions of the  section,  its  non-registration  would  be  no  bar to its being admitted in evidence.

and again                

the  Section,  however,  enjoins registration  in  respect  of  any  document,  which  purports  not  which  intends  to  create  a  right  in  immovable  property  or  declare  a  right  in immovable  property.   It  is  not a  question  of  declaration  of  an  existing  right.”

29. It  has,  accordingly,  been submitted  that  it  was in  the  

interest of the sub-lessees that they execute tripartite deeds  

duly stamped and registered so that they could safeguard the  

title to their properties and deal with them accordingly as they  

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were holding legal documents.  It has been highlighted by the  

learned  counsel  that  the  AWHO  had  on  several  occasions  

realized the importance of the execution of the tripartite deeds  

and had advised the Societies accordingly.

30. Concededly  a  lease  deed  or  sub-lease  of  immovable  

property would be compulsorily registerable under Section 17  

(1)(d) of the Registration Act  and Section 107 of the Transfer  

of Property Act.  In the absence of such a document, Section  

49 visualizes no legal effect or an effective transfer by way of a  

lease or sub-lease.

31. We  have,  therefore,  no  hesitation  in  setting  aside  the  

judgment of the Division Bench of the High Court and to allow  

the appeals and dismiss the writ petitions.  We do so, however,  

with no order as to costs.

32. Before  we  part  with  the  judgment,  we  must  make  a  

further  direction.  During  the  course  of  arguments,  it  was  

pointed out that notices had been issued by NOIDA calling for  

the  execution of  tripartite  deeds failing  which penalties  etc.  

would  be  imposable  on  the  individual  sub-lessees,  more  

particularly as a large number of allottees had already signed  

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such deeds.   In the light of the fact that this has been a long  

drawn  litigation  and  involves  primarily  serving  or  retired  

personnel of the armed forces, we direct that if the sub-lessees  

execute  tripartite  deeds  as  per  the  requirement  of  NOIDA  

within a period of six months from today, no penalty or extra  

charge would be made payable by such allottees.  We clarify  

that if the tripartite deeds are not executed within the period  

of six months, the law or instructions would take their own  

course and NOIDA would be entitled to levy such charges as it  

was entitled to thereunder.    

…………………………J. (DALVEER BHANDARI)

..............................J. (HARJIT SINGH BEDI)

NEW DELHI, DATED: SEPTEMBER 10, 2010

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