Punjab-Haryana High Court
K.J. Khosla vs Smt. Rajlakshmi on 8 January, 2001
Author: R.L. Anand
Bench: R.L. Anand
JUDGMENT R.L. Anand, J.
1. This is a Civil Revision and has been directed against the judgment dated 8.8.1983, passed by the Additional District Judge, Patiala, who, affirmed the order dated 25.5.1981, passed by the Court of Sub Judge 1st Class, Patiala, who, dismissed the petition under Section 14 of the Indian Arbitration Act, 1940, for making the award dated 10.7.1979, given by the Arbitrator, as Rule of the Court.
2. The brief facts of the cases are that Dewan Niranjan Parshad had two sons namely K.J. Khosla and N. Khosla, who, were the applicants in the application under Section 14 of the Indian Arbitration Act. Said Dewan Niranjan Parshad, had three daughters by the names of Shrimati Raj Lakshmi, Smt. Nirmala and Smt. Saraswali who has since expired and S/Shri A.C. Talwani, Manik Talwani and Pardeep Talwani, are the legal heirs of said Smt. Saraswati. Dewan Niranjan Farshad had a big ancestral kothi known as "Nishkan", situated on Bhupendra Nagar Road, Pa-tiala. In October. 1956, Dewan Niranjan Parshad gifted three plots of the land forming part of this Kothi in its rear portion to his three daughters namely Raj Lakshmi, Nirmala and Saraswati with the consent of his wife Smt. Amar Devi and his two sons S/Shri K.J. Kholsa and N. Khosla. The gift was witnessed by Shri B.S. Talwani, who was the husband of Smt. Saraswati. This gift was recorded in family year book known as "Dussehra Bahi". It was further affirmed by Dewan Niranjan Parshad through a registered "Deed of Relin-quishment" on 10,6.1961. Smt. Sarawati died in the year 1966. Dewan Niranjan Parshad is alleged to have revoked the gift and resumed the plots on 10.5.1971 with the consent of his two daughters and Shri B.S. Talwani, husband of Saraswati and paid Rs. 10,000/-to each of them in lieu of the plots. Dewan Niranjan Parshad then partitioned the property by allotting separate share to his two sons and this oral partition was recited in memo of partition dated 6.12.1974. On 14.1.1975, Dewan Niranjan Parshad died.
3. After the death of Dewan Niranjan Parshad, a dispute arose between his two sons on one hand and two daughters and heirs of third daughter on the other in respect of the three plots of land which had been gifted and then resumed on revocation of the gift by Dewan Niranjan Parshad. The parties vide agreement dated 27.10.1978 referred the dispute to the sole arbitration of Shri Ram Kishan, Advocate, Ludhiana who gave the award dated 10.7.1979. The arbitrator died on 22.10.1979
4. The petitioners filed an application under Section 14 of the Indian Arbitration, 1940 Act, praying that the arbitrator be directed to file the award in the Court and the same may be made rule of the Court.
5. Notice of this application was given to the respondents who filed the objections and pleaded that the award created, declared and extinguished, rights in the immovable property of the value of more than rupees one hundred and this award requires compulsory registration under the provisions of the Indian Registration Act and since the award in dispute was not registered so it cannot be made a rule of the Court.
6. The petitioners filed reply to these objections and pleaded that the award does not require registration at this stage. The respondent-objectors filed the replication to the reply of the petitioners and they pleaded in the replication that party No. 1 has not denied that it requires registration but has stated that it does not require registration at this stage. This contention appears to have been taken by Party No. 1 on a Full Bench decision of the Punjab and Haryana High Court which however, stands over-ruled by the Hon'ble Supreme Court by a judgment reported as AIR 1970 S.C, 833, Satish Kumar v. Surinder Kumar.
7. From the above pleadings of the parties the trial Court framed the following issues :-
1. Whether the arbitrator has misconducted himself and the proceedings ? OPR
2. Whether the award has been improperly procured by the petitioners, who are men or authority or is otherwise, invalid ? OPR
3. If issues Nos. I and 2 are proved, whether the award is liable to be set aside ? OPR
4. Whether the award has been presented by a person duly authorised by the arbitrator ? If not, what is its effect ? OP. parties.
5. Whether the award required registration ? If so, what is the effect of its not being registered ? OPR
6. Whether the 3 plots of land were not the subject matter of dispute referred for arbitrator under the agreement ? If so, what is the effect of the arbitrator giving his award relating to the same ? OPR
7. Whether the award has been given beyond the statutory or extended period and is, therefore, invalid ? OPR
8. Whether Sh. B.S. Talwani was not general attorney of A.C. Talwani, Manik Talwani and Pardeep Talwani and had no right to appoint an arbitrator to enter upon the reference on their behalf ? OPR
9. Refief.
8. Issue No. 5 was treated as preliminary issue. The parties were afforded the opportunities to lead evidence on issue No. 5. They did not lead any evidence. Rather the lawyers of the parties made a statement before the trial Court that the value of the three plots in dispute is more than rupees one hundred.
9. The parties addressed arguments before the trial Court and issue No. 5 was decided in favour of the respondents and it was held that the award dated 10.7.1979 requires registration. Since the award has not been registered, therefore, no right or interest is created under the award in favour of the petitioners.
10. Aggrieved by the findings of the trial Court, the petitioners filed the first appeal before the Court of Additional District Judge, Patiala, who vide judgment dated 8.8.1983, dismissed the appeal, for the reasons given in paras No. 11 to 16 of the said judgment.
11. Still not satisfied, the present revision was filed in the High Court somewhere in the year 1983 and it was admitted in the year 1986.
12. I have heard Shri Sanjay Kaushal, learned Counsel appearing on behalf of the petitioners and Shri Ashok Aggarwal, Sr. Advocate, assisted by Shri Padam Jain, Advocate, appearing on behalf of the respondents and with their assistance have gone through the record of this case.
13. Let me again make a summary of the history of this case. The Kothi known as "Nishkam" was a property of Dewan Niranjan Parshad. The entire land formed part of this Kothi. Three plots were carved out. Dewan Niranjan Parshad gifted three plots out of the land forming part of this Kohti, in its rear portion, to his three daughters, Raj Lakshmi, Nirmala and Saraswati with the consent of his wife Smt. Amar Devi and his two sons K.J. Khosla and N. Khosla. The gift was even recorded in the family year book known as "Dussehra Bahi."
14. Later on, Dewan Niranjan Parshad revoked that gift and resumed the plots on 10.5.1971 with the consent of his two daughters and with the consent of the husband of Smt. Saraswati and paid Rs. 10,000/- to each of them. Subsequently, Dewan Niranjan Parshad partitioned his property by allotting separate share to his two sons and this oral partition was recited in the memorandum of partition dated 6.12.1974. Thus, it is clear that at one point of lime there was a gift by Dewan Niranjan Parshad with respect of these three plots in favour of his daughters namely Raj Lakshmi, Nirmala and Saraswati. I will try to show from my subsequent discussion that gift was conditional. The donees were supposed to accept that gift according to law and further they were supposed to raise the construction. They did not do so. As a result of the Dewan Niranjan Par-shad thought it proper to take back those plots and give Rs. 10,000/- to each one of the daughters but the dispute still survived between the two brothers on one side and two sisters and the heirs of the third sister on the other side and vide agreement dated 27.10.1978 parties thought it proper that let the matter be referred to the arbitration of Shri Ram Kishan Advocate, who finally gave the award on 10.7.1979.
15. The point is very short in this case "whether the award dated 10.7.1979, creates, extinguishes and declares some rights in the immovable property in favour of one against the other and if so whether this award is compulsorily registrable as per the provision of Section 17 of the Registration Act" ?
16. It was conceded before the trial Court that the value of the plots was defintiely more than one hundred rupees at the time of the passing of the award.
18. The learned Counsel appearing on behalf of the petitioners submitted that the award dated 10.7.1979 does not require any registration because this award has not created any right, title or interest in favour of any of Ihe parties. Rather it had declared some rights in favour of the petitioners and these rights were pre-existing. In support of his contention, the learned Counsel appearing on behalf of the petitioners has relied upon some case law which I shall also deal within the subsequent portion of this judgment.
19. Let us first examine the substantive provisions which are contained in Section 17(1)(b) of the Registration Act. It lays down that "other non- testamentary instruments" which purport or operate to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property". Thus, any instrument relating to immovable property requires registration when it declares an interest in the immovable property provided the value of the interest so declared is one hundred rupees or upwards. The words "create, limit or extinguish and right, title or interest", imply a definite change of legal relation to the property.
20. We have to see whether the award is more a recital of fact or it creates something in the shape of a title between the parties. In this regard 1 will have to see under what background the matter was referred to the arbitration. The matter was referred to the arbitration vide agreement dated 27.10.1978. The relevant port ion of this agreement runs as follows :-"Whereas there is a dispute regarding three plots of land in the rear part of the compound of the ancestral "Kothi" of the late Dewan Niranjan Parshad called "Nishkam" situated on 23, Bhupendra Na-gar Road, Patiala beiween Krishna Jiwan Khosla and Navjeevan Khosla of the first part and their sisters Sarv Shrimati Raj Lakshmi and Nirmala and their brother-in-law Shri B.S. Talwani, husband of their predeceased sister Smt. Saraswati on his behalf and on behalf of the other heirs of the aforesaid Shrimati Saraswati, namely, Shri A.C. Talwani and Drs. Manik Talwani and Pardeep Talwani as their general attorney of the second part being sons, daughters, son-in-law and grand-sons of the late Dewan Niranjan Par-shad."
21. Thus, there was a clear dispute between the brothers and the sisters and the heirs of the sister namely, Saraswati, and the sisters were not submitting to the wishes of the brothers, who, always laid the claim that the gift in favour of their sisters had since been revoked and the property has vested in Dewan Niranjan Par-shad. Thus, there was a dispute between the parties which was agreed to be resolved amicably, expecli-tiously and without resort to the litigation, as is clear from the wordingof the agreement itself. The parties in pursuance of that reference appeared before Shri Ram Kishan Advocate, who gave the award of 10.7.1979 and the award itself suggests that it was regarding the dispute of three plots on vacant land in the house known as "Nishkam" situated at Bhupendra Nagar Road, Patiala.
22. Now, we have to see what was the stand of the brothers before the arbitrator. Their stand was that their father Dewan Niranjan Parshad had gifted three plots of land forming part of the Kothi ."Nishkam", to his three daughters in the year 1956 and an entry to that effect was made in the family Dtissehra Bahi and a deed dated 10.6.1961 was also executed. The plots were given to three daughters for constructing their houses and to settle there. It was also the stand of the brothers that their father revoked the gift and resumed the plots on 10.5.1971 at the instance and with the consent of Raj Lakshrni, Ninnata and Shri B.S. Taiwani on payment of Rs. 10,000/- to each of them as the daughters had not built up their houses till then. Resul-tantly, their father executed a memo of partition on 6.12.1974 in favour of his two sons allotting them the separate portion in the whole house known as "Nishkam" including the three plots which were earlier gifted to the sisters. The brothers also alleged before the arbitrator that the gift deed was not acted upon as the physical and actual possession was never given to them.
23. On the contrary, the stand of the sisters and the husband of the sister Saraswati, was that the gift is still valid. It was never revoked by their father nor the plots were ever resumed. Thus, the factum of gift is also admitted by the brothers in favour of their sisters. In these circumstances, there was definitely a dispute between the parties, "whether the gift made by the father in favour of his daughters was valid and whether this has been revoked or whether the plots were resumed or not ? If by the award spine rights are created, declared, assigned or extinguished whelher in present or future, and if those rights pertain to immovable property, the value of which is rupees one hundred or more, such an award requires registration being non- testamentary instrument.
24. The case of the petitioners is that the gift which was created in favour of their sisters, was never acted upon as it was revoked and that the sisters were paid Rs. 10,000/- each by their father. Further the stand of the brothers is that they have become the owners of the property. Through the award the Arbitrator has declared that the brothers are the owners of the property because the gift deed, whicn was made by the father in favour of his daughters, is bad for certain reasons. Those reasons are :-
(i) That the gift was made in 1956 on the condition that daughters would build up their houses and settle thereon. No house was built during ihis long period. Even the possession was not delivered by the donor to the donee as is clear from the document dated 10.5.1971.
(ii) The gift was never acted upon. Even the gift deed remained in the possession of the donor throughout;
(iii) That Dewan Niranjan Parshad donor revoked the gift and resumed three plots at the instance and with the consent of the donees on the ground that the plots were not of any remunerative value and agreed to convert the plots into cash. They accepted the cash in lieu of the plots as mentioned in Exs. K-4 and K-6 and in the written statement.
25. Thus, the award has taken away some rights from the sisters by giving a declaration that the donee did not comply with the condition of the gift. In this way, sisters were divested of some rights and those rights were created for the first time in favour of the brothers by the impugned award as is further clear from the following wording :-
"I give my award in favour of Shri Krishan Jiwan and Shri Navel Jiwan and hold that the gift was revoked and plots were resumed by the late Dewan Niranjan Parshad at the instance and with the consent of the second party in lieu of cash payment received by them."
26. It was also observed by the arbitrator that the mutation of the land in favour of the daughters was of no value. These entries are wrong. Dewan Niranjan Par-shad and Smt. Saraswati had died long before the mutation was sanctioned and before sanctioning of the mutation no notice appears to have been issued to any of the parties. In such a situation, it cannot be said that award only declared a pre-existing right in favour of the sons. Rather by the award itself, an adjudication has been made by the Arbitrator that the gift created by the father in favour of his daughters is not enforceable because it was never accepted by the donees and it was never acted upon as per the conditions of the gift. One of the conditions was that the daughters shall construct their houses. Thus, the document of award declares and creates rights in favour of the brothers by taking it from the sisters and when those rights are created in the presentee, then such document/award requires registration and such an award without registration cannot be acted upon as it docs not confer any right, title or interest in favour of the brothers. It can certainly be looked inio only for collateral purpose under Section 49 of the Registration Act.
27. The learned counsel for the petitioner relied upon a judgment of the Hon'ble Supreme Court reported as AIR 19S7 Supreme Court 841, Ashok Keshyap v. Mrs. Sudha Vasisht and another, in which 'it was held that Section 17(1)(b) of the Registration Act enjoins that any non-testamentary instrument which purports or operates to create, declare, assign, limit or extinguish, whether in presenter in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property should be registered. It was also held in the cited case that where the award of the arbitrator, though declared the share of the parties in the property, it created a right by itself, in favour of one party to get particular sum from another party and right to obtain the payment and on payment the obligation of relin-quishment of right or interest in the property, such an award does not create any right in immovable property and as such is not compulsory to register it. This cited judgment can be safely distinguished. The award in question docs not declare the share of the parties in the property. I have already highlighted above that the case of the sisters was that the gift made by their father in their favour is valid. It has never been revoked nor the plots were ever resumed. They did not get the pay-
ment from the father. Rather they are the owners of these plots on the basis of the gift. Therefore, there was no question of declaration of the pre-existing rights of the parties. This contention of the sisters did not find favour with the arbitrator who held that though there was a gift but it was not valid for one reason or the other and, therefore, a declaration was given in favour of the brothers that they have become the owners of the property. The rights were created for the first time through the award itself and, therefore, this award required registration.
28. The learned counsel for the respondents, Shri Ag-garwal, referred to AIR 1970 S.C, 833, Satish Kumar v. Surinder Kumar, and submitted that the award of the arbitrator affects the rights of the parties with respect to immovable property worth more than rupees one hundred and, therefore, the registration is compulsory.
29. A perusal of the award would show that the respondents claimed the ownership of the plots on the basis of the gift and on the basis of the relinquishment deed and the petitioners claimed the ownership on the basis of the alleged revocation of the gift. Declaration was given by the Arbitrator after referring the dispute of the parties that the petitioners are the owners of the disputed property. These rights have been created in the present tense of the award. Otherwise also, it is not open now to the petitioners to say that the award does not require registration. The respondents took the objection in the written statement that the award required registration. The petitioners on the contrary stated that the award does not require registration at that stage. Perhaps mis plea was taken by the petitioners because at that time the award was not made the rule of the Court. This was the position of the law as contained in AIR 1968 Punjab and Haryana 204, a Full Bench decision of this Court tiled Sandool Singh v. Hari Singh. The petitioners were under the impression that since the award has not been made the rule of the Court, therefore, no registration was required. Let it become the rule of the Court and let it get the force of a decree. They were relying upon AIR 1968 Punjab and Hary-ana 204 but unfortunately for the petitioners this judgment was set aside by the Hon'ble Supreme Court by a judgment reported as AIR 1970 S.C. 833. By this time much water had flown under the bridges. Assuming for the sake of arguments that it is a legal plea and that the petitioners are not to suffer because of the loose pleadings or wrong plea taken up in the reply to the objection, still the petitioners have not been able to improve their case further because of the fact that the award has to be interpreted as it is. I cannot impart or exclude anything from the award. The present award is a declaration vide which certain rights of the respondents were extinguished and rights in favour of the petitioners were created by making them the owners of the disputed plots by rejecting the defence and contentions of ihe sisters. Thus, the award is squarely covered by the provisions of Section 17(1)(b) of the Indian Registration Act. Support can also be taken from AIR 1968 Supreme Court 1299, Siromani and another v, Hemkumar and others, where, it was held that an instrument of partition of immovable property requires registration if it declares an interest in the immovable property provided the value of the interest so declared is rupees one hundred or upwards. As 1 have already held above, that the award had declared certain rights for the first time in favour of the petitioners, therefore, it was bound to be registered within the statutory period of four months or within the extended statutory period.
30. Thus, I affirm the impugned judgments of the Courts below and do not see any illegality, impropriety or infirmity in the same. The revision is totally devoid of any merit and the same is hereby dismissed with costs. Counsel fee is assessed at Rs. 5000/-.
31. Revision dismissed.