REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 3192 OF 2010 [Arising out of SLP (C)  No. 1451 of 2009]

S. Kaladevi …. Appellant  

Vs.  

V.R. Somasundaram & Ors.         ….Respondents

JUDGMENT

R.M. LODHA,J.

Leave granted.  

2. The  short  question  is  one  of  admissibility  of  an  

unregistered sale deed in a suit  for  specific  performance of  the  

contract.  

3. The appellant   and the respondents are plaintiff  and  

defendant nos. 1, 2 and 3 respectively in the suit presented in the  

Court of  Subordinate Judge, Gobichettipalayam.  The plaintiff in  

the  suit  claimed  for  the  reliefs  of  directing  the   defendants  to  

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execute  a  fresh  sale  deed  with  regard  to  the  suit  property  in  

pursuance of an agreement for sale dated 27.02.2006 on or before  

the date that may be fixed by the court and failing which  execution  

of  the  sale  deed  by  the  court.   She  also  prayed  for  grant  of  

permanent  injunction  restraining  the  defendants  from  disturbing  

with her peaceful possession and enjoyment of the suit property.   

4. According to the plaintiff,  1st defendant for himself,  as  

the  guardian  father  of  3rd defendant  and  2nd defendant  jointly  

entered into an oral agreement with her on 27.02.2006 to sell the  

suit property for a consideration of Rs. 1,83,000/-.  It was agreed  

that the sale deed, in pursuance of the oral agreement for sale,  

would be executed and registered on the same day.  The plaintiff  

purchased the stamp papers; paid the entire sale consideration to  

the defendants; the defendants put the plaintiff  in possession of  

the suit property and also executed a sale deed in her favour.  On  

27.02.2006  itself,   the  said  sale  deed  was  taken  to  the  Sub-

Registrar’s office.  The  Sub-Registrar, however,  informed that in  

view of an order of attachment of the suit property the sale deed  

could  not  be  registered.    The  sale  deed,  thus,  could  not  be  

registered.     The  defendant  nos.  1  and  2  then  promised  the  

plaintiff  that  they  would  amicably  settle  the  matter  with  the  

concerned party who had obtained attachment of the suit property  

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and get  the sale deed registered no sooner the attachment was  

raised.  The plaintiff averred that she called upon the defendants to  

get the sale deed registered, but the defendants avoided the same  

by putting forth the reason that attachment in respect of the suit  

property  was  subsisting.    On 04.02.2007 however,  the  plaintiff  

called upon defendant nos. 1 and 2 to cooperate in getting the sale  

deed  registered,  but  instead  of  doing  that   the  defendants  

attempted to interfere with her possession and enjoyment of the  

suit property necessitating action by way of suit.   

5. The 1st defendant filed written statement and traversed  

plaintiff’s case.  He denied having entered into an oral agreement  

for sale with the plaintiff for himself and as a guardian father of 3rd  

defendant and the 2nd defendant jointly on 27.02.2006 as alleged.  

He also denied having delivered physical  possession of the suit  

property to the plaintiff.  The  1st defendant  set up the defence that  

he  had  taken  loan  from  one  Subramaniam  and  when  

Subramaniam demanded the repayment  thereof,  he approached  

plaintiff and requested her to lend Rs. 1,75,000/- as loan.  Upon  

plaintiff’s  insistence  that  1st defendant  should  execute  an  

agreement for sale in her favour, he and the 2nd defendant signed  

the  document  believing  that  to  be  agreement  for  sale  on  

27.02.2006 and went to the office of Sub-Registrar for getting the  

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agreement for sale registered.   However, when the  Sub-Registrar  

asked  the  1st defendant  whether  the  consideration  has  been  

received  and  sale  deed  could  be  registered,  he  and  the  2nd  

defendant  learnt  that  plaintiff  had  fraudulently  obtained  the  

signatures  on  sale  deed  by  falsely  stating  that  it  was  only  an  

agreement for sale and hence they went away refusing to agree  

for the registration of the said document.    

6. On the basis of the pleadings of the parties, the issues  

were  struck.   It  appears  that  on  05.12.2007  at  the  time  of  

examination  of  PW.  1,    the  unregistered  sale  deed  dated  

27.02.2006 was tendered for being marked.  The counsel for the  

defendants  objected  to  the  said  document  being  admitted  in  

evidence being an unregistered sale deed.  The trial court by its  

order  dated  11.12.2007  sustained  the  objection  and  refused  to  

admit the sale deed in evidence.   

7. The plaintiff unsuccessfully challenged the order of the  

trial  court  dated 11.12.2007 by filing revision petition before the  

High Court  and hence this appeal by special leave.   

8. After  having  heard  Mr.  K.  V.  Vishwanathan,  learned  

senior  counsel  for  the  appellant  and  Mr.  T.S.R.  Venkatramana,  

learned counsel  for the respondents,  we are of  the opinion that  

having regard to the proviso to Section 49 of the Registration Act,  

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1908 (for short, `1908 Act’), the trial court erred in not admitting the  

unregistered sale deed dated 27.02.2006 in evidence and the High  

Court ought to have corrected the said error by setting aside the  

order of the trial court.  

9. Mr.  T.S.R.  Venkatramana,  learned  counsel  for  the  

respondents,  however,  strenuously  urged  that  1908  Act  is  a  

complete code by itself and is a special law and, therefore, any  

dispute regarding the registration, including the refusal to register  

by  any  party,  is  covered  by the  provisions  of  that  Act  and  the  

remedy can be worked out under it only.   He referred to Sections  

71 to 77 of the 1908 Act and submitted that refusal to register a  

document  by  a  party  is  exhaustively  dealt  with  by  the  said  

provisions and the provisions of the Specific Relief Act, 1963 (for  

short, `1963 Act’) cannot be and should not be invoked in a case of  

failure to register a document which is complete in other respects,  

except  for  want  of  registration.    Learned  counsel  for  the  

respondents  submitted  that  the  defendants   refused  to  admit  

execution  of  the  said  document  before  the  concerned  Sub-

Registrar because of the fraud played by the appellant (plaintiff)  

inasmuch  as  instead  of  writing  an  agreement  to  sell,  she  got  

executed a full fledged sale deed contrary to the agreement and  

understanding.   The  defendants  accordingly  walked  out  of  the  

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office of Sub-Registrar without admitting the execution of the sale  

deed and under these circumstances the only remedy available to  

the appellant was to get an endorsement “registration refused” and  

then file an application before the Registrar under Section 73 of  

the 1908 Act.    He also referred to  Section 3 of  1963 Act and  

submitted that the provisions of 1963 Act would not override the  

provisions of 1908 Act.     

10. Section  17  of  1908  Act  is  a  disabling  section.   The  

documents defined in clauses (a) to (e) therein require registration  

compulsorily.    Accordingly,  sale  of  immovable  property  of  the  

value of Rs. 100/- and more requires compulsory registration.  Part  

X of the 1908 Act deals with the effects of registration and non-

registration.   Section  49 gives teeth  to  Section 17 by providing  

effect of non-registration of documents required to be registered.  

Section 49  reads thus:

“S.49.-  Effect  of  non-registration  of  documents  required to be registered.-  No document required  by section 17 or by any provision of the Transfer of  Property Act, 1882 (4 of 1882), to be registered shall  –

(a) affect  any  immovable  property  comprised  therein, or  

(b)          confer any power to adopt, or  

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(c)        be received as evidence of any transaction  affecting such property or conferring such  power,

unless it has been registered:

Provided  that  an  unregistered  document  affecting  immovable  property  and  required  by  this  Act or the Transfer of Property Act, 1882 (4 of 1882),  to be registered may be received as evidence of a  contract  in  a  suit  for  specific  performance  under  Chapter  II  of  the  Specific  Relief  Act,  1877  (3  of  1877),  or  as evidence of  any collateral  transaction  not required to be effected by registered instrument.”

11. The  main  provision  in  Section  49  provides  that  any  

document which is required to be registered, if not registered, shall  

not  affect  any  immovable  property  comprised  therein  nor  such  

document  shall  be  received  as  evidence  of  any  transaction  

affecting such property.  Proviso, however,  would show that an  

unregistered document affecting immovable property and required  

by 1908 Act or the Transfer of Property Act, 1882 to be registered  

may  be  received  as  an  evidence  to  the  contract  in  a  suit  for  

specific performance or as evidence of any collateral transaction  

not required to be effected by registered instrument.  By virtue of  

proviso,  therefore,  an  unregistered  sale  deed  of  an  immovable  

property of the value of Rs. 100/- and more could be admitted in  

evidence  as  evidence  of  a  contract  in  a  suit  for  specific  

performance of the contract.   Such an unregistered sale deed can  

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also  be  admitted  in  evidence  as  an  evidence  of  any  collateral  

transaction not  required to  be effected by registered document.  

When an unregistered sale deed is tendered in evidence, not as  

evidence of a completed sale, but as proof of an oral agreement of  

sale,  the  deed  can  be  received  in  evidence  making  an  

endorsement  that  it  is  received  only  as  evidence  of  an  oral  

agreement of sale under the proviso to Section 49 of 1908 Act.    

12. Recently in the case of K.B. Saha and Sons Private  

Limited v. Development Consultant Limited1, this Court noticed the  

following  statement  of  Mulla  in  his  Indian  Registration  Act,  7th  

Edition, at page 189:-

“……The  High  Courts  of  Calcutta,  Bombay,  Allahabad, Madras, Patna, Lahore, Assam, Nagpur,  Pepsu, Rajasthan, Orissa, Rangoon and Jammu &  Kashmir; the former Chief Court of Oudh; the Judicial  Commissioner’s  Court  at  Peshawar,  Ajmer  and  Himachal Pradesh and the Supreme Court have held  that  a  document  which  requires  registration  under  Section 17 and which is not admissible for want of  registration  to  prove a  gift  or  mortgage or  sale  or  lease  is  nevertheless  admissible  to  prove  the  character of the possession of the person who holds  under it…...”

1 (2008) 8 SCC 564 8

This Court then culled out the following principles:-

“1. A  document  required  to  be  registered,  if  unregistered  is  not  admissible  into  evidence  under Section 49 of the Registration Act.  

2. Such unregistered document can however be  used as an evidence of collateral purpose as  provided in  the proviso  to  Section 49 of  the  Registration Act.  

3. A collateral  transaction must  be independent  of,  or divisible from, the transaction to effect  which the law required registration.  

4. A collateral transaction must be a transaction  not  itself  required  to  be  effected  by  a  registered  document,  that  is,  a  transaction  creating,  etc.  any  right,  title  or  interest  in  immovable  property  of  the  value  of  one  hundred rupees and upwards.  

5. If a document is inadmissible in evidence for want  of registration, none of its terms can be admitted  in evidence and that to use a document for the  purpose of proving an important clause would not  be using it as a collateral purpose.”    

To the  aforesaid  principles,  one  more  principle  may be  added,  

namely, that a document required to be registered, if unregistered,  

can be admitted in evidence as evidence of a contract in a suit for  

specific performance.   

13. In Kalavakurti Venkata Subbaiah v. Bala Gurappagari  

Guruvi  Reddy2,  the  question  presented  before  this  Court  was  

2 (1999) 7 SCC 114 9

whether a decree to enforce the registration of sale deed could be  

granted.  That was a case where respondent therein filed a suit for  

specific performance seeking a direction to register the sale deed.  

The  contention of the appellant,  however, was that  decree for  

specific performance based on unregistered sale deed could not  

be granted.  This Court noticed the provisions contained in Part XII  

of  1908  Act,  particularly  Section  77,  and  difference   of  opinion  

between the various High Courts on the aspect and  observed:-

“The  difference  of  opinion  amongst  the  various  High  Courts  on  this  aspect  of  the  matter  is  that  Section 77 of the Act is a complete code in itself  providing  for  the enforcement  of  a  right  to  get  a  document registered by filing a civil suit which but  for the special provision of that section could not be  maintainable.  Several  difficulties  have  been  considered in these decisions, such as, when the  time has expired since the date of the execution of  the document whether there could be a decree to  direct the Sub-Registrar to register the document.  On the other hand, it has also been noticed that an  agreement  for  transfer  of  property  implies  a  contract  not  only to execute the deed of transfer  but also to appear before the registering officer and  to  admit  execution  thereby  facilitating  the  registration  of  the  document  wherever  it  is  compulsory.  The provisions of  the Specific  Relief  Act and the Registration Act may to a certain extent  cover  the  same  field  but  so  that  one  will  not  supersede the other. Where the stage indicated in  Section 77 of  the Act  has reached and no other  relief  except  a  direction  for  registration  of  the  document is really asked for, Section 77 of the Act  may  be  an exclusive  remedy.  However,  in  other  cases it has no application, inasmuch as a suit for  specific performance is of a wider amplitude and is  primarily  one  for  enforcement  of  a  contract  and  other  consequential  or  further  relief.  If  a  party  is  seeking not merely the registration of a sale deed,  

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but also recovery of possession and mesne profits  or damages, a suit under Section 77 of the Act is  not an adequate remedy.”

 14. This Court then held that the first appellate court rightly  

took the view that under Section 49 of the 1908 Act, unregistered  

sale deed could be received in evidence to prove the agreement  

between the parties though it may not itself constitute a contract to  

transfer the property.  It was held:

“……The document has not been presented by the  respondent to the Sub-Registrar at all for registration  although  the  sale  deed  is  stated  to  have  been  executed by the appellant as he refuses to cooperate  with him in that regard.  Therefore, various stages  contemplated under Section 77 of the Act have not  arisen in the present case at all.  We do not think, in  such  a  case  when  the  vendor  declines  to  appear  before the Sub-Registrar, the situation contemplated  under Section 77 of the Act would arise.  It is only on  presentation of a document the other circumstances  would arise.  The first appellate court rightly took the  view that under Section 49 of the Act the sale deed  could  be  received  in  evidence  to  prove  the  agreement  between  the  parties  though  it  may  not  itself constitute a contract to transfer the property….. ”.   

15.  The  issue  before  us  is  only  with  regard  to  the  

admissibility  of  unregistered  sale  deed  dated  27.2.2006  in  

evidence and, therefore, it is neither appropriate nor necessary for  

us to  consider  the  contention raised  by  learned counsel  for  the  

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respondents  about  the  maintainability  of  suit  as  framed  by  the  

plaintiff or the circumstances in which the sale deed was executed.  

If  any  issue  in  that  regard  has  been  struck  by  the  trial  court,  

obviously,  such issue would be decided in accordance with law.  

Suffice, however, to say that looking to the nature of the suit, which  

happens to be a suit for specific performance, the trial court was  

not justified in refusing to admit the unregistered sale deed dated  

27.2.2006 tendered by the plaintiff in evidence.  

16. The argument of learned counsel for the respondents  

with regard to Section  3(b) of  1963 Act is noted to be rejected.  

We  fail  to  understand  how  the  said  provision  helps  the  

respondents as the said provision provides that nothing in 1963  

Act  shall  be  deemed  to  affect  the  operation  of  1908  Act,  on  

documents.   By  admission  of  an  unregistered  sale  deed  in  

evidence in a suit for specific performance as evidence of contract,  

none of the provisions of 1908 Act is affected; rather court acts in  

consonance with proviso appended to Section 49 of 1908 Act.    

17. The result  is that appeal is allowed, the order of the  

High  Court  dated  13.11.2008  and  that  of  the  trial  court  dated  

11.12.2007  are  set  aside.   The  trial  court  shall  mark  the  

unregistered sale deed dated 27.2.2006 tendered by the plaintiff in  

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her evidence and proceed with the suit accordingly.   The parties  

shall bear their own costs.  

……………………………...J.                             [R.V. RAVEENDRAN]

 ……………………………...J.

                                 [R.M. LODHA]

NEW DELHI APRIL 12, 2010.

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