S. KALADEVIversusV.R. SOMASUNDARAM AND ORS.

                    [2010] 4 S.C.R. 515


                       S. KALADEVI                             A
                             v.
             V.R. SOMASUNDARAM AND ORS.
               (Civil Appeal No. 3192 of 2010)

                      APRIL 12, 2010
                                                               B
       [R.V. RAVEENDRAN AND R.M. LODHA, JJ.]

      Registration Act, 1908: s.49, proviso - Unregistered
 sale deed is admissible in evidence in a suit for specific
 performance of the contract - Evidence Act, 1872 - Specific   C
 performance - Transfer of property Act, 1882.

      The question which arose for consideration in the
 present appeal was whether the courts below erred in
 holding that an unregistered sale. deed was not               0
 admissible in evidence in a suit for specific performance
 of the contract.

     Allowing the appeal, the Court
      HELD: The Trial Court erred in not admitting the         E
  unregistered sale deed in evidence in view of the proviso
  to Section 49 of the Registration Act, 1908 and the High
  Court ought to have corrected the said error by setting
  aside the order of the trial court. The main provision in
  Section 49 provides that any document which is required      F
  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           G
  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
                            515                                H
    516      SUPREME COURT REPORTS               [2010) 4 S.C.R.


A transaction not required to be e1ffected 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 b1! admitted in evidence
  as evidence of a contract in a suit for specific
B performance of the contract. Such an unregistered sale
  deed can also be admitted in evidence as-an evidence of
  any collateral transaction not required to be effected by
  registered document. When an unrE~gistered sale deed is
  tendered in evidence, not as evid,ence of a completed
c 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 1m oral agreement of
  sale under the proviso to Sectioni 49 of 1908 Act. By
  admission of an unregistered sale deed in evidence in a
  suit for specific performance as evidence of contract.
0
  none of the provisions of 1908 Ac:t is affected; rather
  court acts in consonance with p1r.oviso appended to
  Section 49of1908 Act. [Paras 8, 11, 16] (519-C-D; 521-A-
  E; 525-B]
E      KB. Saha and Sons Private Limited v. Development
    Consultant Limited (2008) 8 SCC 564, relied on.
        Ka/avakurti Venkata Subbaiah v. Bala Gurappagari
    Guruvi Reddy (1999) 7 SCC 114, referred to.

F                       Case Law Refernnce:
          (2008) 8 sec 564       relied on            Para 12
          (1999) 1 sec 114       referred 1to         Para 13
      CIVIL APPELLATE JURISDICTION : Civil Appeal No.
G 3192 of 2010.
        From the Judgment & Order dated 13.11.2008 of the High
    Court of Judicature at Madras in C.R.P .(PD) No. 261 of 2008.
      K.V. Vishwanathan, B. Rajunath, Vijay Kumar for the
H Appellant.
 S. KALADEVI v. V.R. SOMASUNDARAM AND ORS. 517


    T.S.R. Venkatramana, G.S. Mani, R. Satish for the                A
Respondents.

     The Judgment of the Court was delivered by

     R.M. LODHA,J. 1. Leave granted.
                                                                     B
     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          c
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 execute a fresh sale deed with regard to the suit
property in pursuance of an agreement for sale dated
                                                                     0
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. Sh~
also prayed for grant of permanent injunction restraining the
defendants from disturbing with her peaceful possession and
enjoyment of the suit property.
                                                                     E
      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        F
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         G
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    H
the matter with the concerned party who had obtained
    518      SUPREME COURT REPORTS                   [2010] 4 S.C.R.


A attachment of the suit property and get the sale deed
  registered no sooner the attachment was raised. The plaintiff
  averred that she called upon the defondants to get the sale
  deed registered, but the defendants avoided the same by
  putting forth the reason that attachment in respect of the suit
B 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 ofthe
  suit property necessitating action by w.a.y of suit.
c        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
D   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 plaintiffs insistence that
E   1st defendant should execute an agreement for sale in her
    favour, he and the 2nd defendant i;igned the document
    believing that to be agreement for sale on 27.02.2006 and went
    to the office of Sub-Registrar for getting the agreement for sale
    registered. However, when the Sub-Hegistrar asked the 1st
F   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 a!~ree for the registration
G   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 unregistiered sale deed dated
H 27.02.2006 was tendered for being marked. The counsel for
 S. KALADEVI v. V.R. SOMASUNDARAM AND ORS. 519
                [R.M. LODHA, J.]
the defendants objected to the said document being admitted           A
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 ordef of the
                                                                      8
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       C
having regard to the proviso to Section 49 of the Registration
Act, 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.                  D

     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          E
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,
                                                                      F
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               G
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 office of Sub-Registrar without
admitting the execution of the sale deed and under these              H
     520          SUPREME COURT REPORTS               [2010] 4 S.C.R.


A 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 1962> Act and submitted
  that the provisions of 1963 Act would not override the
  provisions of 1908 Act.
8
       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
C 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:

o          "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,
c.                 or

            (b)    confer any power to adopt, or

            (c)    be received as evidence of any transaction
                   affecting such property or conferring such power,
F
           unless it has been registered:

                 Provided that an unregistered document affecting
           immovable property and required by this Act or the Transfer
G          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
H          instrument."
 S. KALADEVI v. V.R. SOMASUNDARAM AND ORS. 521
                [R.M. LODHA, J.]

      11. The main provision in Section 49 provides that any A
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 B
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  c
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 also be admitted in evidence as
an evidence of any collateral transaction not required to be.
                                                                  0
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 E
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:-                       F

    "...... The High Courts of Calcutta, Bombay, Allahabad,
    Madras, Patna, Lahore, Assam, ~agpur, Pepsu,
    Rajasthan, Orissa, Rangoon and Jammu & Kashmir; the
    former Chief Court of Oudh; the Judicial Commissioner's        G
    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     H
    522         SUPREME COURT REPORTS                  [2010) 4 S.C.R.


A         of the possession of the person who holds under it.. .... "

          This Court then culled out the followin£1 principles:-

           "1.    A document required to be registered, if
                  unregistered is not admissible into evidence under
B                 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.
c          3.     A collateral transaction must be independent of, or
                  divisible from, the transaction to t~ffect which the law
                  required registration.

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

E          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."
F        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.

G       13. In Kalavakurti Venkata Subbaiah v. Bala Gurappagari
    Guruvi Reddy2, the question presented before this Court was
  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
H sale deed. The contention of the appellant, however, was that
S. KALADEVI v. V.R. SOMASUNDARAM AND ORS.                     523
               [R.M. LODHA, J.]
decree for specific performance based on unregistered sale            A
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:-
                                                                      B
     "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     C
     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          D
    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        E
    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              F
    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 r:iot merely the registration of a sale deed, but      G
    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   H
    524       SUPREME COURT REPORTS                  [2010] 4 S.C.R.


A 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 prnsented by the
B
          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 cooperatH with him in that
          regard. Therefore, various stages contE~mplated under
          Section 77 of the Act have not arisen in the present case
c         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
D         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 itse.lf constitute a
          contract to transfer the property ..... ".

E       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 appropriate1 nor necessary
  for us to consider the contention raised by IHarned counsel
  for the respondents about the maintainability of suit as framed
F by the plaintiff or the circumstances in which the sale deed was
  executed. If any issue in that regard has been stiruck 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,
G 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.
H We fail to understand how the said provision helps the
 S. KALADEVI v. V.R. SOMASUNDARAM AND ORS. 525
                [R.M. LODHA, J.]
respondents as the said provision provides that nothing in 1963    A
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       B
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           C
unregistered sale deed dated 27.2.2006 tendered by the
plaintiff in her evidence and proceed with the suit accordingly.
The parties shall bear their own costs.

D.G.                                          Appeal allowed.