Andhra HC (Pre-Telangana)
Dadi Reddy Sivanarayana Reddy vs Kasi Reddy Chinnamma on 28 November, 2000
Equivalent citations: 2001(1)ALD349, 2001(1)ALT524, AIR 2001 ANDHRA PRADESH 142, (2001) 1 CIVILCOURTC 610, (2001) 2 CURCC 151, (2002) 2 LANDLR 41, (2001) 1 ANDHLD 349, (2001) 2 ICC 547, (2001) 1 ANDH LT 524
ORDER
1.This civil revision petition is filed against the order dated 18-7-2000 in OS No.337 of 1998. By the said order the Court of Principal Junior Civil Judge sustained the objection of the Counsel for defendant for marking the suit document and held that the suit document is unregistered sale deed and hence it is inadmissible in evidence.
2. The facts in brief are as follows : The plaintiff-revision petitioner (hereinafter called 'the plaintiff') filed a suit against the respondent-defendant (hereinafter called 'the defendant') for specific performance of agreement of sale dated 15-4-1984 executed by the defendant in respect of agricultural land in S.No.201/1 admeasuring Ac.1.60 cents situated at Gillella village, Proddutur Mandal. The plaintiff also sought the relief of permanent injunction. During the trial, when the plaintiff sought to mark the document dated 15-4-1984 the Counsel for the defendant raised objection that the suit document is sale deed and for want of registration and proper stamp duty, the same is not admissible in evidence. Therefore, the trial Court heard the learned Counsel for the plaintiff as well. It was contended for the plaintiff that though the entire sale consideration was paid and the property was delivered possession, in view of the covenant that the defendant would execute sale deed in favour of the plaintiff as and when demanded, the same cannot be treated as sale deed. The trial Court referring to the recitals in the document in question came to the conclusion that the document being unregistered sale deed is inadmissible in evidence. The trial Court referred to the judgment of the Supreme Court in Kashinath Bhaskar v. Bhaskar Vishweshwar, and judgments of this Court in K. Sarojamma v. G. Muni Lakshama, 1981 (2) An. WR 47 (NRC), Tirunam Gurappa v. Naidu Ramana Reddy, and Banguru Ramathulasamma v. Yedem Masthan Reddy, . Relying on Bangaru Ramathulasmma's case (supra) held that the document in question cannot be marked. Aggrieved by this order, the plaintiff filed this civil revision petition.
3. Learned Counsel for the petitioner Sri M.N. Narasimha Reddy submits that as the suit document contemplates another document of transfer giving right to the plaintiff to demand a regular sale deed, the same cannot be treated as sale deed. Being not a sale deed or deed of conveyance the same is not required registration under Section 17(2)(v) of the Registration Act and he submits that in any event being a suit for specific performance, the document in question is admissible in evidence in proof of the contract. He relied on Section 49 of the said Act.
4. Notice before admission was ordered and after receiving notice Sri G. Srinivasa Reddy filed appearance. Sri Sadasiva Reddy, representing Sri G. Srinivasa Reddy submits that proviso to Section 49 of the Registration Act does not apply as the plaintiff filed the suit stating that the suit document is an agreement of sale. He also submits that Section 17(2)(v) of the Act has no application to the facts of this case.
5. Whether the document based on which a suit is filed is a sale deed or agreement of sale is a question that repeatedly comes up before the trial Court during the trial as well as at the time of disposal of the suit. Therefore, I propose to examine the legal aspects of the matter in some detail.
6. After referring to suit document the trial Court held that the same is not an agreement of sale and that it is unregistered sale deed and hence inadmissible in evidence. The trial Court drew support for such view by relying on the judgment of this Court in Bangaru Ramathulasamma's case (supra). Though the judgment of this Court reported in Sarojamma's case (supra) and Thirunam Gurappa's case (supra) were adverted to, the trial Court followed the judgment in Bangaru Ramathulasamma's case (supra) holding that the said decision prevails over the earlier decisions.
7. The point for consideration in this revision is whether the trial Court acted illegally and with material irregularity in exercise of its jurisdiction.
8. As per Section 3 of the Indian Evidence Act, 1872, (hereinafter called 'the Evidence Act') evidence means and includes all statements which the Court permits or requires to be made before it by witness, in relation to matters to fact under enquiry called oral evidence and all documents produced for inspection of the Court are called documentary evidence. As per Section 91 of the Act when the terms of contract have been reduced to the form of a document and in all cases in which any matter is required by law to be reduced to the form of a document, no evidence shall be given in proof of the terms of the contract except the document itself. Under Section 49 of the Registration Act, 1908 (hereafter called 'the Registration Act') no document required by Section 17 of the Act or by any provision of the Transfer of Property Act, 1882 to be registered shall be received as evidence of any transaction affecting such property if it is not registered as per law.
9. It is therefore necessary to refer to Sections 17 and 49 of the Registration Act to the extent they are relevant. Section 17(1) of the Registration Act enumerates documents, which shall be registered.
"Section 17(2) : Nothing in clauses (b) and (c) of sub-section (1) applies-
(i)...............
(ii)............
(iii)...............
(iv)..............
(v) any document not itself creating declaring, assigning, limiting or extinguishing any right, title or interest of the value of the hundred rupees and upwards to or in immovable property, but merely creating a right to obtain another document which will, when executed, create, declare, assign, limit or extinguish any such right, title or interest; or
(vi)................
(vii)............
(viii)...........
(ix)............
(x)....................
(xi).........
(xii)..............
Explanation :-- A document purporting or operating to effect a contract for the sale of immovable property shall not be deemed to require or ever to have required registration by reason only of the fact that such document contains a recital of the payment of any earnest money or of the whole or any part of the purchase money".
10. A reading of clause (v) of sub-section (2) of Section 17 and explanation to Section 17(2) of the Act shows that unless a document of contract for sale of immovable property creates or extinguishes right, title or interest in the immovable property a document merely creating right to obtain another document which when executed creates right, title or interest need not be registered. Now we may refer to Section 49 of the Registration Act, which is as under :
"49. 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
(c) be received as evidence of any transaction affecting such 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 (1 of 1877), or as evidence of part-performance of a contract for the purposes of Section 53-A of the Transfer of Property Act, 1882 (4 of 1882), or as evidence of any collateral transaction not required to be effected by registered instrument)".
11. A plain reading of Section 49 and the proviso thereto shows that a document, which requires registration under Section 17, shall not be received as evidence of any transaction. But, such prohibition does not apply to an unregistered document affecting immovable property in a suit for specific performance under the Specific Relief Act or as evidence of part performance of contract or as evidence of any collateral transaction not required to be effected by registered document. The proviso makes a distinction insofar as a suit for specific performance under the Specific Relief Act is concerned. Therefore, Section 17(2)(v) and explanation under Section 17(2) stand further explained by the proviso to Section 49 of the Registration Act.
12. In retrospect, prior to 1929 there was difference of opinion among various Courts as to whether a document which gives a right to obtain another document if also contains such clauses so as to indicate that the right, title and interest also stands 'conveyed' can be the basis in a suit for specific performance of contract. Having regard to the judgment of the Privy Council in N. Varada Pillai v. V. Jeevarathnammal, AIR 1919 PC 44, Special Committee on Indian Legislature examined the amendments to Transfer of Property Act and Registration Act. The Special Committee proposed to amend Sections 48 and 49 to empower the Courts to admit unregistered documents in evidence in giving effect to the doctrine of part performance. The matter was referred to Select Committee, which after examining the whole issue opined as under.
"We propose that Sections 48 and 49 should be amended to empower Courts to admit unregistered documents in evidence in giving effect to the doctrine of part-performance. The Select Committee's Report on this Section is in identical terms.
Section 49 enacts that a document which is required to be registered and is not registered cannot be received in evidence. It has been held by the Judicial Committee that such documents although not admissible for the purpose of proving the transaction purported to have been effected by them are admissible in evidence for collateral purposes, such as, for ascertaining the nature of possession. In giving effect to the doctrine of part-performance, where transactions are not complete owing to the omission of registration, it is necessary that Courts should be empowered to admit them in evidence for the purpose of proving part-performance. A proviso has accordingly been added to the Section, Gazette of India, dated 20th August, 1927, Pt. V.p. 103 and Gazette of India, dated 9th March, 1929, Pt. V.p. 75 cited in Sanjiva Row's Registration Act, 8th edition 1998, page 451.
13. By Transfer of Property (Amendment) Supplementary Act XXI of 1929 proviso to Section 49 was added. I may reiterate that proviso to Section 49 is an exception to the general rule that unregistered documents with reference to Section 17 are inadmissible. The proviso says that unregistered document effecting immovable property may be received as evidence of contract in a suit for specific performance under the Specific Relief Act or as evidence a performance of the contract for the purpose of Section 53-A of the Transfer of Property Act etc.
14. The following principles emerge from the above examination of the legal provisions.
(i) A document produced for inspection of the Court cannot be admitted in evidence under Section 49(c) of the Registration Act, if it is required registration under Section 17 of the said Act.
(ii) Any document by whatever name called not creating, declaring, assigning, limiting or extinguishing any right, title or interest, but merely creating right to obtain another document does not require registration under Section 17(1) of the Registration Act.
(iii) As a necessary corollary a document of contract for safe of immovable property creating right to obtain another document shall not require registration by reason of the payment of earnest money or whole or part of purchase money by the purchaser.
(iv) In any event, the prohibition under Section 49(c) of the Registration Act does not apply to an unregistered document effecting immovable property in a suit for specific performance under the Specific Relief Act or as evidence of part performance of contract of as evidence of any collateral transaction not required to be effected by registered document.
15. Keeping in view the legal principles, I propose to examine the suit document. The document dated 15-4-1984 has a heading as 'sale agreement' giving possession of the land. After giving necessary recitals, the agreement says that the vendor sold the land in consideration of an amount of Rs.28,000/- given by the plaintiff to the defendant at the time of her marriage. It speaks of possession being given to the plaintiff and also says that the vendor shall execute another document at the office of sub-registrar as and when requested by the vendee. There are clauses that the vendor has handed over the property to the plaintiff with all rights of enjoyment and clause admitting that the vendor or her heirs have no rights in the land. In the last clause again vendor says that she is executing the sale agreement on her own volition.
16. It is well settled that where the document is to be construed, the document itself should be looked into to gather the intention of the parties. The document has to be construed as a whole and no clause can be read in isolation in an attempt to resort to extraneous enquiry as to what the parties thought or intended. If there is any ambiguity in the language employed it is however permissible to look to the surrounding circumstances to determine what was intended. The document in question purports to convey immovable property to the plaintiff with all rights of sale, gift etc. One should ask a question whether on the basis of the suit document the plaintiff can validly convey title of the property to third parties, that is to say whether the plaintiff has a marketable title vesting in him (see Section 49(a)) and whether the agreement has extinguished the right in the defendant. As per Section 17(2)(v) of the Act when a document creates right, title or interest in one party and extinguishes any right, title or interest in the other party, then only it is registrable. In this case, the heading as well as the last clause in the agreement describes the document as sale agreement. It further says that the vendor shall execute anther document at the office of the sub-registrar as and when required. In the light of these compelling circumstances, the clause that vendor sold the property to be enjoyed by the plaintiff and his heirs does not conclusively extinguish the rights in defendant and hence does not require registration. Not only explanation to Section 7 but proviso to Section 49 of the Registration Act comes into play.
17. In Kashinath Bhaskar's case (supra) the Supreme Court was dealing with suit for recovery of money based on two mortgages. The defendant, who was the appellant before the Supreme Court, relied on agreement dated 17-10-1937 to prove satisfaction of the debt. The trial Court excluded the document from evidence and disbelieved the case of "satisfaction of debt". Before the Supreme Court the question was whether the document require registration and whether the defendant can rely on agreement dated 17-10-1937 for a collateral purpose of proving full payment of mortgage amount.
18. The document in question admittedly settled and formulated new terms of mortgage with regard to principal as well as interest amount. Clause 10 of the agreement provided for all defendant to execute stamped and registered agreement if mortgagee so wishes or if necessary. Reading the agreement as a whole, the Apex Court ruled that the document limits and extinguishes interest in immovable property within the meaning of Section 17(1)(b) of the Registration Act and therefore requires registration. After considering each clause independently the Supreme Court, adverting to clause (x) which provides for obtaining another document, repelled the contention of the appellant based on Section 17(2) (v) of the Registration Act in the following manner :
"It was argued that this brings the matter within Section 17(2)(v) of the Registration Act, because it gives the defendant the right to obtain another document which will effect the extinguishment. We do not agree because clause (v) of sub-section (2) of Section 17 of the Act postulates that the document shall not of itself create, declare, assign, limit, extinguish any right etc and that it shall merely create a right to obtain another document etc. (The stress is on the words 'itself and 'merely).
We agree with Sir Dinsha Mulla at P.86 of the 5th edition of his Indian Registration Act that 'If the document itself create an interest in immovable property, the fact that it contemplates the execution of another document will not exempt it from registration under this clause'.
19. The ratio of this judgment is that the crucial test is not whether the document merely creates a right to obtain another document but whether the document 'limits and extinguishes' the right, title and interest in the property in the present and future in 'presenti' or in future.
20. In Kashinath Bhaskar 's case (supra) the Supreme Court separately considered agreement to sell and agreement to transfer on a future date and the effect of proviso to Section 49 of the Registration Act. While laying down that if a document limits or extinguishes interest in the immovable property, the same requires registration and that the clause enabling the obtain another document which creates a right is not crucial. The Supreme Court in the said context observed as under :
"An agreement to sell, or an agreement to transfer at some future date, is to be distinguished because that sort of document does not of itself purport to effect the transfer. It merely embodies a present agreement to execute another document in the future which will, when executed, have that effect".
21. The Supreme Court then referred to Section 49 of the Registration Act and observed as under.
"The next question is whether the document can be used in evidence under the proviso to Section 49, Registration Act. We are clear it cannot. This is not a suit for specific performance nor does any question of part performance under Section 53-A of the Transfer of Property Act arise".
22. Before considering other cases, it is necessary to notice that the Hon'ble Supreme Court agreed with the statement of law by Sir Dinsha Mulla in his Indian Registration Act 5th edition to the effect that if the document itself creates an interest in immovable property, the fact that it contemplates execution of another document will not exempt it from registration under that clause. Further, the said statement of the Supreme Court is made in connection with interpretation of mortgage deed and not agreement of sale or suit for specific performance. In any event, the Supreme Court in paragraphs 17 and 18 clarified that the law insofar as the agreement to sell is concerned, different considerations would come into play and by virtue of Section 49 of the Registration Act an unregistered document purporting to convey and transfer title of immovable property is also admissible in evidence.
23. In K. Sarojamma's case (supra) His Lordship the Hon'ble Sri Justice Seetharam Reddy referred to proviso to Section 49 of the Registration Act and held as under :
"Whether an instrument is an agreement to sell or a contract of sale shall have to be determined with reference to the contents and the character of the instrument itself and the intent of the executant could be gathered from the same. The fact that the entire consideration was paid and the land was put in possession and the words 'that the vendee shall from the date of the document have complete control over the property and enjoy the same with full rights' are not determinative or conclusive of the question that the document constitutes a contract of sale. The essential element is that the document must transfer immovable property or an interest therein which should be inter vivos so as to constitute conveyance within the meaning of Section 2(1) of the Stamp Act, in other words there should be vesting of title in one and divesting from the other who gives up title.
......................... Even if the document is to be deemed to be a deed of sale which is not, it will still be admissible within the meaning of the proviso to Section 49 (c) of the Registration Act, as evidence of contract in a suit for specific performance under the Specific Relief Act as the executant has agreed at the end that he will execute and register the sale deed as and when he is called upon to do so".
24. In Tirunam Gurappa's case (supra) His Lordship Hon'ble Sri Justice P.L.N. Sarma considered the question whether the language in the document to the effect that 'executant sold the property and put the plaintiff in possession amounts to proper conveyance. His Lordship observed that when a document is construed, the entire document will have to be looked into for ascertaining the intention of the parties and that each of the clauses by themselves cannot be taken as conclusive. The intention of the parties has to be gathered by reading the document as a whole. After referring to the judgment of the Supreme Court in Kashinath Bhaskar's case (supra) as well as other cases, the learned Judge held that the document which contained any indication as to conveyance cannot be taken as marking the document a sale deed.
25. The learned Counsel for the respondent placed strong reliance on the judgment of this Court in Bangaru Ramathulasamma's case (supra). In the said case the facts are as follows. The plaintiff filed a suit for permanent injunction relating to suit property alleging that he purchased the property from second and third defendants under a document described as an agreement of sale. When the document was sought to be marked as evidence, the first defendant objected for marking the document on the ground that the same is in the nature of sale deed and that being unstamped and unregistered is inadmissible in evidence. The Court of District Munsif, Gudur rejected the objection by the first defendant placing reliance on the judgment of Tirunam Gurappa's case (supra). The first defendant filed a revision petition under Section 115 of CPC before this Court. The learned single Judge who heard the revision petition referred to the contents of the disputed document and recorded a specific finding that the disputed document though styled as an agreement of sale is a sale deed inasmuch as the rights in immovable property are conferred under the document. Then His Lordship Justice R. Bayapu Reddy referred to Paras 16 and 17 of the judgment of the Supreme Court in Kashinath Bhaskar's case (supra) and came to the conclusion that the judgment of Justice P.L.N. Sarma in Tirunam Gurappa 's case (supra) is per incurium. I have already analysed the judgment of the Supreme Court in Kashinath Bhaskar's case (supra) and a reading of paragraphs 17 and 18 would clearly show whatever is applicable to mortgage deed is not applicable to a document which is the foundation in a suit for specific performance of agreement of sale in view of proviso to Section 49 of the Registration Act. Therefore, I am of the considered opinion that Bangaru Ramathulasmma's case (surpa) does not in any way help the respondent herein. I may hasten to add that the learned Judge in Tirunam Gurappa's case (supra) referring to Kashinath Bhaskar's case (supra) and on consideration of all aspects in relation to disputed document came to the conclusion that it is only an agreement of sale which does not require registration.
26. In the result, the order of the trial Court in refusing to admit the agreement dated 15-4-1984 suffers from illegality and occasions in failure of justice. The same is set aside. The civil revision petition is allowed and the lower Court is directed to proceed with the trial. There shall be no order as to costs.