Delhi District Court
Mohd. Ismail vs Mohd. Umar on 15 January, 2016
IN THE COURT OF SH. APOORV SARVARIA, Ld. CIVIL JUDGE-14, CENTRAL
DISTRICT, TIS HAZARI COURTS, DELHI
Suit No. : 624/15
Unique Case ID No. : 02401C0115212002
Mohd. Ismail .... Plaintiff
versus
Mohd. Umar .... Defendant
ORDER ON APPLICATION FILED UNDER SECTION 17(1)(B) AND SECTION 49
OF THE REGISTRATION ACT READ WITH SECTION 33 AND 35 OF THE
INDIAN STAMP ACT
1. Vide this Order, the application filed under Section 17(1)(b) and Section 49 of the
Registration Act read with Section 33 and 35 of the Indian Stamp Act filed by
objector Mohd. Arif S/o Mohd. Ismail shall be disposed of. In the application, it is
prayed that the present petition for making the award dated 25.04.1982 as rule of
Court may be dismissed under Section 49 and Section 17(1)(b) of the Registration
Act and the instrument of award be impounded under Section 33 and 35 of the
Stamp Act. It is stated in the application that the award dated 25.04.1982 has created
right, title and interest in respect of immovable properties in favour of parties which
were even otherwise not the subject matter of the agreement of reference to the
arbitrator specifically. Since the award had transferred right, title and interest of
immovable properties in favour of parties, the award passed is registrable but the
same has not been registered as required by law and no decree can be passed on the
basis of the said award. It is further stated that the arbitrator had acted illegally and
passed the award on a meager stamp paper of Rs. 75/- or Rs. 100/- while the
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properties were of value of more than lakhs of rupees and proper stamp duty
has not been affixed.
2. In reply filed by Mohd. Afzal, S/o Late Mohd. Umar (non-applicant) to the
application, it is stated that any transfer of property would have to be proceeded
only after making the award rule of the Court for which the arbitrator had filed
the award in the court of law. It is further stated that the similar objection was
taken earlier by the deceased objector but as per knowledge of the non-
applicant, no weightage was given by the predecessor courts. However, it is
stated in the reply that in case court comes to the conclusion that the award was
required to be compulsorily registered, the same may be sent to the Sub-
Registrar to register it with penalty. It is further stated in the reply that the
arbitrators neither created nor transferred any right, title or interest in favour of
parties.
3. Arguments have been heard and record has been perused. Ld. Advocate for the
applicant has relied upon the decision in Ramesh Kumar v. Furu Ram VI
(2011) SLT 419 (SC).
4. The award in question is in Urdu language and its translation in English is also
filed on record. The award clearly states that the parties to the dispute had
agreed jointly the distribution of the disputed properties i.e. (i) Shop no. 695,
Hamilton Road, Kashmere Gate, (ii) Building No. C-7/164, Jamuna Puri, (iii)
Plot no. B-2/11, Jamuna Puri, (iv) Plot no. C-7/163, Jamuna Puri, (v) H.No.
670, Gali Nalbandan, Kashmere Gate, (vi) H.No. 671, Gali Nalbandan,
Kashmere Gate, (vii) H.No. 665, Gali Nalbandan, Kashmere Gate, (viii)
Business and Goodwill of Model Engineering Works and other movable
properties. The award is admittedly not registered and it is creating right, title
and interest in favour of the parties in respect of the above mentioned
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immovable properties and other properties.
5. In Ramesh Kumar v. Furu Ram VI (2011) SLT 419 (SC), the Supreme Court
has held as under:
"37. Chapter III of Registration Act, 1908 relates to registrable
documents. Section 17 enumerates the documents which are
compulsorily registrable and the exceptions to the categories of
documents which are compulsorily registrable. The relevant portions of
the said sections are extracted below:
"17. Documents of which registration is compulsory (1) The
following documents shall be registered, if the property to 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:-
xxx xxx xxx
(b) 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;
(c) non-testamentary instruments which acknowledge the receipt
or payment of any consideration on account of the creation,
declaration, assignment, limitation or extinction of any such right,
title or interest; and
(2) Nothing in clauses (b) and (c) of sub-section (1) applies to-
xxx xxx xxx
(vi) any decree or order of a court except a decree or order
expressed to be made on a compromise, and comprising
immovable property other than that which is the subject-matter of
the suit or proceeding]."
38. A reading of these provisions make the following position clear (a)
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any non-testamentary document purporting or operating to create,
declare any right, title or interest in any immoveable property of the
value of more than Rs.100 is compulsorily registrable; (b) that an order
or decree of a court is not compulsorily registrable even if it purports or
operates to create, declare any right, title or interest in any immoveable
property of the value of more than Rs.100; (c) that if the decree or order
of the court is not rendered on merits, but expressed to be made on a
compromise and comprises any immoveable property which was not the
subject mater of the suit or proceeding, such order or decree is
compulsorily registrable; and (d) that as clause (iv) of sub-section (2) of
section 17 excludes decrees or orders of court, but does not exclude
awards of arbitrator, any arbitration award which purports or operates to
create, declare any right, title or interest in any immoveable property of
the value of more than Rs.100 is compulsorily registrable.
39. As noticed above, the reference agreements dated 12.3.1992 were not
in regard to any agreement of sale or any dispute relating to immoveable
property, or in regard to the lands in regard to which the award was
made. It did not refer to the lands in question. No dispute regarding
immoveable property was referred to arbitration or was the subject
matter of the arbitration. The alleged subject matter of arbitration was
non-payment of Rs.8,00,000 said to have been borrowed by each of the
appellants. The arbitrator recorded an alleged statement by the borrowers
(appellants) that they had received Rs.8,00,000 from Furu Ram and
Rs.8,00,000/- from Kalu Ram; that they were not able to refund the same
and therefore they had given lands measuring 49 Kanals 10 Marlas to
Furu Ram and another 49 Kanals 9 Marlas to Kalu Ram; and that Furu
Ram and Kalu Ram confirmed that they had obtained possession of the
said land. The awards therefore declared that Furu Ram and Kalu Ram
had become the absolute owners of the lands in question. Thus the
awards are clearly documents which purport or operate to create and
declare a right, title or interest in an immoveable property of the value of
more than Rs.100 which was not the subject of the dispute or reference
to arbitration. Therefore the awards were compulsorily registrable. If
they were not registered, they could not be acted upon under section 49
of the Registration Act, 1908 nor could a decree be passed in terms of
such unregistered awards. Unregistered awards which are compulsorily
registrable under section 17(1)(b) could neither be admitted in evidence
nor can decrees be passed in terms of the same.
40. In Ratan Lal Sharma vs. Purshottam Harit AIR 1974 SC 1066, this
court held :
"So in express words it purports to create rights in immovable
property worth above Rs.100/- in favour of the appellant. It would
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accordingly require registration under S.17, Registration Act. As it
is unregistered, the Court could not look into it. If the court could
not, as we hold, look into it, the Court not pronounce judgment in
accordance with it. Sec. 17, Arbitration Act presupposes an award
which can be validly looked into by the Court. The appellant
cannot successfully invoke Section 17......... we are of opinion that
the award requires registration and, not being registered is
inadmissible in evidence for the purpose of pronouncing judgment
in accordance with it."
In Lachhman Dass vs. Ram Lal - 1989 (3) SCC 99, this Court held :
"In the present case the award declared that half share of
ownership of the appellant to the lands in question "shall now be
owned" by the respondent in addition to his half share in the lands.
On a proper construction of the award, it is thus clear that the award did create, declare or assign a right, title and interest in the immovable property. It is not merely a declaration of the pre- existing right but creation of new right of the parties. Since the award affected the immovable property over Rs.100 it was required to be registered. ..............
An award affecting immovable property of the value of more than Rs.100 cannot be looked into by the court for pronouncement upon the award on the application under Section 14 of the Arbitration Act unless the award is registered. ...........
As the court could not look into the award, there is no question of the court passing a decree in accordance with the award and that point can also be taken when the award is sought to be enforced as the rule of the court."
The courts below have not considered or decided this aspect at all. "Re:
Question (iv) If an award was not genuine, but was collusive and sham, the court will not and in fact can not make it a rule of the court. As noticed above, there should be a dispute, there should be an agreement to refer the dispute to arbitration, there should be reference to arbitration, there should be an adjudication or decision by the arbitrator after hearing parties, for a valid arbitration. If the parties had already settled their disputes and the arbitration award was only a ruse to avoid payment of stamp duty and registration with respect to a sale deed and declare a title in persons who did not have title earlier, then the entire proceedings is sham and bogus."
(emphasis added)
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6. It is clear from the above said decision of the Hon'ble Supreme Court in Ramesh Kumar v. Furu Ram that the arbitral awards made pursuant to the Arbitration Act, 1940 creating rights, title or interest in an immovable property of value of more than Rs. 100/- were compulsorily registrable. If such an award is unregistered, the Court will not make it Rule of the Court. In view of the above precedent, since the award in the present petition was required to be compulsorily registrable as it created rights, title or interest in immovable properties mentioned above and is admittedly not registered, there is merit in the present application and the court has to refuse to make the award Rule of the Court. In view of the above observations, the application filed by the applicant/objector is allowed and the petition for making the award Rule of the Court is dismissed. File be consigned to Record Room.
Announced in the Open Court Apoorv Sarvaria,
on the day 15th January, 2016 Civil Judge14, Central,
Tis Hazari Courts, Delhi
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