AMEER MINHAJversusDIERDRE ELIZABETH (WRIGHT) ISSAR AND ORS.

                         [2018] 5 S.C.R. 173                             173


                         AMEER MINHAJ                                    A
                                  v.
     DIERDRE ELIZABETH (WRIGHT) ISSAR AND ORS.
                  (Civil Appeal No. 18377 of 2017)
                             JULY 04, 2018                               B
       [DIPAK MISRA, CJI, A. M. KHANWILKAR AND
                  DR. D. Y. CHANDRACHUD, JJ.]
       Registration Act, 1908 – s. 17(1A) – Transfer of Property
Act, 1882 – s. 53A – Document of which registration compulsory –
On facts, unregistered agreement to sell, on the basis of which relief   C
of specific performance claimed, registered power of attorney and
general power of attorney – Admissibility in evidence – Trial court
held that all the three documents could be marked and received as
evidence – However, the High Court set aside the same – Held:
Document is required to be registered, but if unregistered, can still    D
be admitted as evidence of a contract in a suit for specific
performance – In view thereof, the document though exhibited, could
be received as evidence of a contract in a suit for specific
performance and nothing more – As regards, the General Power of
Attorney, being a registered document, the trial court justified in
holding that there is a legal, rebuttable presumption that the same      E
has been duly stamped – Furthermore, the agreement to sell was
executed prior to coming into force of s. 17(1A) – Hence, the same
was not required to be compulsorily registered at the time of its
execution – Even if it was required to be registered, the same could
be received as evidence for a limited purpose – Thus, the order of       F
the trial court is restored – Genuineness, validity and binding nature
of the document or whether it was hit by the provisions of the 1882
Act or 1899 Act, to be adjudicated at the appropriate stage – Stamp
Act, 1899.
      Allowing the appeal, the Court
                                                                         G
       HELD: 1.1 On a plain reading of s. 17(1A) of the
Registration Act, 1908 it is amply clear that the document
containing contract to transfer the right, title or interest in an
immovable property for consideration is required to be registered,
if the party wants to rely on the same for the purposes of Section
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                                 173
174            SUPREME COURT REPORTS                      [2018] 5 S.C.R.


A     53A of the Transfer of Property Act, 1882 to protect its possession
      over the stated property. If it is not a registered document, the
      only consequence provided in this provision is to declare that
      such document shall have no effect for the purposes of the said
      Section 53A of the 1882 Act. [Para 10][180-F-G]
B           1.2 A document is required to be registered, but if
      unregistered, can still be admitted as evidence of a contract in a
      suit for specific performance. In view thereof, the conclusion
      recorded by the High Court in the impugned judgment that the
      sale agreement is inadmissible in evidence, will have to be
      understood to mean that the document though exhibited, will bear
C     an endorsement that it is admissible only as evidence of the
      agreement to sell under the proviso to Section 49 of the 1908
      Act and shall not have any effect for the purposes of Section 53A
      of the 1882 Act. In that, it is received as evidence of a contract in
      a suit for specific performance and nothing more.[Para 11][181-
D     F-G]
             1.3 Reverting to the registered General Power of Attorney,
      the same has been executed by the original defendant No.1 -
      predecessor in title of respondent Nos.1 & 2 (defendant Nos.3
      & 4), in favour of respondent No.3 (defendant No.2). Being a
E     registered document, the trial court was justified in observing
      that there is a legal, rebuttable presumption that the same has
      been duly stamped. As observed by the trial court, the question
      as to whether the document is hit by the provisions of the 1882
      Act or the 1899 Act can be decided after the parties adduce oral
      and documentary evidence. The High Court, therefore, should
F     have stopped at that instead of analysing the said instrument by
      invoking the principle of incorporation by reference to the
      agreement to sell dated 12th November, 1995. For, the appellant
      (plaintiff) is not a party to the said document. Indeed, the executor
      of the document – original defendant No.1 and the defendant No.2
G     in whose favour the same has been executed, are parties to the
      present suit. The principal document, namely, the agreement to
      sell dated 12th November, 1995, as rightly noticed by the Courts
      below, was executed prior to coming into force of Section 17(1A)
      of the 1908 Act. That provision has been made applicable
      prospectively. Hence, the same was not required to be
H     compulsorily registered at the time of its execution. Even if it
 AMEER MINHAJ v. DIERDRE ELIZABETH (WRIGHT) ISSAR                        175


was required to be registered, keeping in view the purport of            A
Section 49 read with Section 17(1A) of the 1908 Act, the same
could be received as evidence for a limited purpose, without
having any effect for the purposes of Section 53A of the 1882
Act. [Para 12][182-B-F]
      1.4 As a result, the trial court was right in overturning the      B
objection regarding marking and exhibiting these documents as
urged by respondent Nos.1 & 2 (defendant Nos.3 & 4), while
making it clear that the question regarding the genuineness,
validity and binding nature of the documents, including as to
whether it is hit by the provisions of 1882 Act or the 1899 Act, as
the case may be, would be decided at the appropriate stage after         C
the parties adduce oral and documentary evidence. The order of
the trial court is restored. [Paras 13, 15][182-F-G; 183-A]
      S. Kaladevi v. V.R. Somasundaram and Ors. (2010) 5
      SCC 401 : [2010] 4 SCR 515; K.B. Saha and Sons
      Private Limited v. Development Consultant Limited                  D
      (2008) 8 SCC 564 : [2008] 8 SCR 290; Avinash Kumar
      Chauhan v. Vijay Krishna Mishra (2009) 2 SCC 532 :
      [2008] 17 SCR 944 – referred to.
                        Case Law Reference
                                                                         E
      [2010] 4 SCR 515                  referred to     Para 10
      [2008] 8 SCR 290                  referred to     Para 11
      [2008] 17 SCR 944                 referred to     Para 14
      CIVIL APPELLATE JURISDICTION: Civil Appeal No. 18377
                                                                         F
of 2017.
      From the Judgment and Order dated 02.12.2016 of the High Court
of Judicature at Madras in C.R.P. (PD) No. 1700 of 2016.
      B. Karunakaran, S. Gowthaman, Advs. for the Appellant.
      Jayant Bhushan, Sr. Adv., R. Varghese, Chirayu Jain, Ketal Paul,   G
Rohit Kumar Singh, A. Lakshminarayanan, Advs. for the Respondents.
      The Judgment of the Court was delivered by


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176             SUPREME COURT REPORTS                            [2018] 5 S.C.R.


A            A. M. KHANWILKAR, J. 1. This appeal emanates from the
      decision of the High Court dated 2nd December, 2016 allowing the
      application preferred by respondent Nos.1 & 2 (defendant Nos.3 & 4)
      whereby the admissibility of the documents produced by the appellant
      (plaintiff) in the suit filed by him for relief of specific performance of
      contract with alternative relief of refund of advance amount and
B
      permanent injunction against the defendants was questioned.
             2. The appellant filed a suit in the Court of District Judge of the
      Nilgiris at Udhagamandalam, being O.S. No.23 of 2010, against Mr.
      Charles Thomas Orme Alford Wright who died during the pendency of
      the suit whereafter respondent Nos.1 & 2 herein (defendant Nos.3 & 4)
C     were brought on record as his heirs and legal representatives. It was
      asserted in the suit that the original defendant No.1 was the absolute
      owner of 4.80 acres of land in Survey No.H-48A in R.S. No.332/1 of
      Coonoor Rural Village. He had entered into an agreement of sale with
      respondent No.3 (defendant No.2) on 12th November, 1995 agreeing to
D     sell the said property either to the second defendant or its nominees. It is
      further asserted by the appellant (plaintiff) that in furtherance of the
      said agreement to sell the second defendant was put in possession of the
      property agreed to be sold, in part performance of the agreement of sale
      and that fact has been recited in the agreement of sale itself. The
      agreement also authorized the second defendant, at its discretion, to
E     develop the property by constructing dwelling units thereon for which
      the predecessor in title of respondent Nos.1 & 2 (namely the original 1st
      defendant) was to cooperate and give consent, whenever and wherever
      necessary, for the unhindered development of the property. It was then
      asserted by the appellant (plaintiff) that to effectuate the stated agreement
F     to sell, a registered Power of Attorney was executed in favour of the
      second defendant (respondent No.3) by the owner (original first
      defendant). That Power of Attorney was registered on 2nd May, 1996 in
      the office of Sub Registrar, Coonoor. It was then stated that since
      respondent No.3 (defendant No.2) was unable to develop the said
      property due to unavoidable situation, he requested the appellant (plaintiff)
G     to execute the project of developing the suit property into building sites
      for dwelling units and to sell it to prospective purchasers. The appellant
      (plaintiff) accepted the said offer after doing due diligence and resultantly,
      an agreement of sale came to be executed on 9th July, 2003 by the 1st
      defendant - the original owner of the suit property namely the predecessor
H
 AMEER MINHAJ v. DIERDRE ELIZABETH (WRIGHT) ISSAR                               177
              [A. M. KHANWILKAR, J.]

in title of respondent Nos.1 & 2 - in favour of the appellant (plaintiff)       A
through his Power of Attorney holder, namely, respondent No.3 (2nd
defendant) for a consideration of Rs.1 crore. Earnest money of Rs.25
lakh was paid at the time of the execution of agreement of sale and the
balance was to be paid within a period of 12 months, subject to certain
stipulations. The appellant (plaintiff) was put in possession of the suit
                                                                                B
property upon execution of the agreement of sale dated 9 th July, 2003.
The 1st defendant did not fulfill his obligation within the stipulated period
as a result of which a suit for specific performance, permanent injunction
and alternative relief of refund of the advance amount came to be filed
on 2nd August, 2010.
        3. Admittedly, neither the agreement to sell dated 12th November,       C
1995 executed in favour of defendant No.2 (respondent No.3) nor the
agreement to sell dated 9th July, 2003 executed in favour of the appellant
(plaintiff) has been registered. The Power of Attorney in favour of
respondent No.3 (defendant No.2) dated 2nd May, 1996 has been
registered but executed on a stamp paper of Rs.100/- only. The defendants       D
filed their written statement to counter the claim set up in the plaint by
the appellant. It is not necessary to dilate on the factual matrix as the
issue to be answered in the present appeal/proceedings is very limited.
       4. Suffice it to observe that the contesting defendants have asserted
that the Power of Attorney executed in favour of respondent No.3                E
(defendant No.2) by the original owner of the suit property (defendant
No.1) and predecessor in title of respondent Nos.1 & 2) has been
cancelled on 2nd January, 2002. As a result, respondent No.3 (defendant
No.2) could not have executed the agreement to sell in favour of the
appellant (plaintiff) on 9th July, 2003.
                                                                                F
       5. Be that as it may, respondent Nos.1 & 2 (defendant Nos.3 &
4) moved a formal application for deciding the admissibility of unregistered
agreements to sell and also to impound the Power of Attorney for having
been executed upon payment of insufficient stamp duty and to impose
suitable penalty before proceeding with the trial. That application was
rejected by the Trial Court on 20th June, 2011 against which the original       G
defendant No.1 and defendant No.3 (respondent No.1) filed a revision
petition before the High Court of Judicature at Madras, being CRP (MD)
No.3422/2011. They were unsuccessful as the High Court dismissed
the revision petition on 30th September, 2011 holding that the question of
payment of stamp duty or the admissibility of the document could be             H
178             SUPREME COURT REPORTS                           [2018] 5 S.C.R.


A     decided only when the stated documents were sought to be marked
      through witnesses and not at that stage. Therefore, after the plaintiff
      filed an affidavit of evidence and sought to rely on the said three
      documents, defendant Nos.3 & 4 (respondent Nos.1 & 2) who were
      brought on record as legal heirs of original defendant No.1, filed a joint
      application, being I.A. No.26/2013, for deciding the question whether
B
      the three documents could be received as evidence. That application
      was decided by the Trial Court on 1st June, 2016 partly in favour of
      defendant Nos.3 & 4. The Trial Court essentially answered the question
      with reference to the mandate of Section 17(1A) of the Registration
      Act, 1908 (for short, “1908 Act”) which was inserted by Act 48 of 2001
C     with effect from 24th September, 2001. The Trial Court took the view
      that the agreement to sell dated 12th November, 1995, having been
      executed prior to the cut-off date, was admissible and could be marked
      as an Exhibit. As regards the Power of Attorney executed in favour of
      respondent No.3 (defendant No.2) on 2nd May, 1996, the Trial Court
      opined that since it was a registered document, there was legal
D
      presumption about the correctness of the valuation of the document for
      the purpose of stamp duty. Further, the document was only a General
      Power of Attorney deed and did not refer to any consideration amount.
      Further, it only authorized respondent No.3 (defendant No.2) to act in
      terms of the Power of Attorney and therefore, it could not be construed
E     as a document of conveyance. Accordingly, the Trial Court rejected the
      objection of respondent Nos.1 & 2 (defendant Nos.3 & 4) for receiving
      the said document as evidence. However, with regard to the third
      document, being an agreement to sell dated 9th July, 2003, the Trial Court
      opined that since the same was executed after coming into force of
      Section 17(1A) of the 1908 Act, it was required to be registered. But
F
      then, considering the purport of the said provision, the document could
      still be exhibited and even if exhibited, the prayer in respect of relief of
      protection of possession in terms of Section 53A of the Transfer of
      Property Act, 1882 (for short, “1882 Act”) could not be granted. In the
      ultimate analysis, the Trial Court opined that all the three documents
G     could be marked and received as evidence. The Trial Court, however,
      made it clear that it was not examining any other contention regarding
      the genuineness, validity and binding nature of the documents or whether
      they were hit by the provisions of the Indian Stamp Act, 1899 (for short,
      “1899 Act”) and 1882 Act. The documents were marked and merely
      exhibited subject to proof and relevancy.
H
 AMEER MINHAJ v. DIERDRE ELIZABETH (WRIGHT) ISSAR                           179
              [A. M. KHANWILKAR, J.]

        6. Being aggrieved by the said decision, respondent Nos.1 & 2       A
(defendant Nos.3 & 4) preferred a civil revision petition before the High
Court of Judicature at Madras being CRP (P.D.) No.1700/2016. The
High Court reversed the decision of the Trial Court. The High Court
interpreted the General Power of Attorney dated 2nd May, 1996 and
construed it as having been given for consideration in furtherance of the
                                                                            B
agreement to sell dated 12th November, 1995. The High Court noted
that since the said General Power of Attorney refers to the agreement
to sell dated 12th November, 1995, the terms and conditions specified in
the latter document would get incorporated into the Power of Attorney,
meaning thereby it was given for consideration, and therefore, it would
attract stamp duty applicable to a deed of conveyance. It could not         C
have been executed on the stamp paper of Rs.100/-. Hence, the
document was inadmissible and could not be received as evidence. As
regards the agreement to sell dated 9th July, 2003, the High Court opined
that the same was required to be registered compulsorily and the Trial
Court was not correct in making an observation that there was no need
                                                                            D
for registration thereof. The High Court, accordingly, allowed the civil
revision petition and was pleased to set aside the order passed by the
Trial Court and instead allowed the application filed by respondent Nos.1
& 2 (defendant Nos.3 & 4), by holding that the General Power of
Attorney dated 2nd May, 1996 was given for consideration as it was in
furtherance of the agreement of sale dated 12th November, 1995. Further,    E
the sale agreement dated 9th July, 2003 was inadmissible as evidence for
the purpose of part performance of contract in view of the statutory bar
in terms of Section 17(1A) read with Section 49 of the 1908 Act.
       7. We have heard Mr. B. Karunakaran, learned counsel appearing
for the appellant and Mr. Jayant Bhushan, learned senior counsel            F
appearing for the contesting respondents.
       8. The limited issue, as considered by the Trial Court and High
Court at the instance of respondent Nos.1 & 2 (defendant Nos.3 & 4),
was about receiving the three documents produced by the appellant
(plaintiff) as evidence. The Trial Court had examined the issue with        G
reference to the provisions of the Registration Act only and had left
open all other questions regarding the validity, genuineness and binding
nature of the said documents, including whether the same were hit by
the provisions of the 1899 Act and the 1882 Act. The Trial Court opined
that those aspects could be decided on the basis of evidence, both oral
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180              SUPREME COURT REPORTS                           [2018] 5 S.C.R.


A     and documentary, to be adduced by the parties.
            9. In other words, the core issue to be answered in the present
      appeal is whether the suit agreement dated 9th July 2003, on the basis of
      which relief of specific performance has been claimed, could be received
      as evidence as it is not a registered document. Section 17(1A) of the
B     1908 Act came into force with effect from 24th September, 2001.
      Whereas, the suit agreement was executed subsequently on 9 th July,
      2003. Section 17 (1A) of the 1908 Act reads thus:
              “17. Documents of which registration is compulsory- (1)
              The following documents shall be registered, if the property to
C             which they relate is situate in a district in which, and if they have
              been executed on or after the date on which, Act No. XVI of
              1864, or the Indian Registration Act, 1866, or the Indian
              Registration Act, 1871, or the Indian Registration Act, 1877, or
              this Act came or comes into force, namely:-
D             XXX                XXX              XXX
              (1A) The documents containing contracts to transfer for
              consideration, any immovable property for the purpose of section
              53A of the Transfer of Property Act, 1882 (4 of 1882) shall be
              registered if they have been executed on or after the
E             commencement of the Registration and Other Related laws
              (Amendment) Act, 2001 and if such documents are not registered
              on or after such commencement, then, they shall have no effect
              for the purposes of the said section 53A.
              XXX                XXX              XXX”
F            10. On a plain reading of this provision, it is amply clear that the
      document containing contract to transfer the right, title or interest in an
      immovable property for consideration is required to be registered, if the
      party wants to rely on the same for the purposes of Section 53A of the
      1882 Act to protect its possession over the stated property. If it is not a
      registered document, the only consequence provided in this provision is
G
      to declare that such document shall have no effect for the purposes of
      the said Section 53A of the 1882 Act. The issue, in our opinion, is no
      more res integra. In S. Kaladevi Vs. V.R. Somasundaram and Ors.,1
      this Court has re-stated the legal position that when an unregistered sale
      1
          (2010) 5 SCC 401
H
    AMEER MINHAJ v. DIERDRE ELIZABETH (WRIGHT) ISSAR                              181
                 [A. M. KHANWILKAR, J.]

deed is tendered in evidence, not as evidence of a completed sale, but as         A
proof of an oral agreement of sale, the deed can be received as evidence
making an endorsement that it is received only as evidence of an oral
agreement of sale under the proviso to Section 49 of the 1908 Act.
Section 49 of the 1908 Act reads thus:
         “49. Effect of non-registration of documents required to                 B
         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
                                                                                  C
           (b) confer any power to adopt, or
           (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,       D
         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.”
                                                                                  E
       11. In the reported decision, this Court has adverted to the principles
delineated in K.B. Saha and Sons Private Limited Vs. Development
Consultant Limited,2 and has added one more principle thereto that a
document is required to be registered, but if unregistered, can still be
admitted as evidence of a contract in a suit for specific performance. In
                                                                                  F
view of this exposition, the conclusion recorded by the High Court in the
impugned judgment that the sale agreement dated 9th July, 2003 is
inadmissible in evidence, will have to be understood to mean that the
document though exhibited, will bear an endorsement that it is admissible
only as evidence of the agreement to sell under the proviso to Section 49
of the 1908 Act and shall not have any effect for the purposes of Section         G
53A of the 1882 Act. In that, it is received as evidence of a contract in a
suit for specific performance and nothing more. The genuineness, validity
and binding nature of the document or the fact that it is hit by the provisions
2
    (2008) 8 SCC 564
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182               SUPREME COURT REPORTS                          [2018] 5 S.C.R.


A     of the 1882 Act or the 1899 Act, as the case may be, will have to be
      adjudicated at the appropriate stage as noted by the Trial Court after the
      parties adduce oral and documentary evidence.
              12. Reverting to the registered General Power of Attorney, the
      same has been executed by the original defendant No.1 - predecessor in
B     title of respondent Nos.1 & 2 (defendant Nos.3 & 4), in favour of
      respondent No.3 (defendant No.2). Being a registered document, in our
      opinion, the Trial Court was justified in observing that there is a legal,
      rebuttable presumption that the same has been duly stamped. As
      observed by the Trial Court, the question as to whether the document is
      hit by the provisions of the 1882 Act or the 1899 Act can be decided
C
      after the parties adduce oral and documentary evidence. The High Court,
      in our opinion, therefore, should have stopped at that instead of analysing
      the said instrument by invoking the principle of incorporation by reference
      to the agreement to sell dated 12th November, 1995. For, the appellant
      (plaintiff) is not a party to the said document. Indeed, the executor of the
D     document – original defendant No.1 and the defendant No.2 in whose
      favour the same has been executed, are parties to the present suit. The
      principal document, namely, the agreement to sell dated 12th November,
      1995, as rightly noticed by the Courts below, was executed prior to coming
      into force of Section 17(1A) of the 1908 Act. That provision has been
      made applicable prospectively. Hence, the same was not required to be
E
      compulsorily registered at the time of its execution. Even if it was required
      to be registered, keeping in view the purport of Section 49 read with
      Section 17(1A) of the 1908 Act, the same could be received as evidence
      for a limited purpose, without having any effect for the purposes of
      Section 53A of 1882 Act.
F           13. As a result, the Trial Court was right in overturning the objection
      regarding marking and exhibiting these documents as urged by respondent
      Nos.1 & 2 (defendant Nos.3 & 4), while making it clear that the question
      regarding the genuineness, validity and binding nature of the documents,
      including as to whether it is hit by the provisions of 1882 Act or the 1899
G     Act, as the case may be, would be decided at the appropriate stage.
            14. The High Court has adverted to the decision in Avinash Kumar
      Chauhan Vs. Vijay Krishna Mishra3, which, however, deals with the
      power of the Court to impound insufficiently stamped instruments in
      exercise of its power under Section 35 of the 1899 Act. That issue will
      3
          (2009) 2 SCC 532
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 AMEER MINHAJ v. DIERDRE ELIZABETH (WRIGHT) ISSAR                              183
              [A. M. KHANWILKAR, J.]

have to be considered by the Trial Court at the appropriate stage which        A
has already been kept open.
      15. Accordingly, this appeal ought to succeed by restoring the
order of the Trial Court dated 1st June, 2016 in the above terms. The
Trial Court shall decide all other issues concerning the validity,
genuineness, applicability and binding nature of the documents including       B
whether it is hit by the provisions of the 1882 Act or the 1899 Act on its
own merits and uninfluenced by the observations made by it or by the
High Court.
      16. The appeal is allowed in the above terms. There shall be no
order as to costs.                                                             C
      17. As the suit is pending since 2010, we direct the Trial Court to
dispose of the same as expeditiously as possible, preferably within a
period of six months from the date of receipt of a copy of this judgment.

                                                                               D
Nidhi Jain                                                   Appeal allowed.




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