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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 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 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 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 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 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 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 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 the proviso to Section 49 of 1908 Act. 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 of 1908 Act. [Paras 8, 11, 16] [519-C-D; 521-A-E; 525-B] K.B. Saha and Sons Private Limited v. Development Consultant Limited (2008) 8 SCC 564, relied on. Kalavakurti Venkata Subbaiah v. Bala Gurappagari Guruvi Reddy (1999) 7 SCC 114, referred to. Case Law Reference: (2008) 8 SCC 564 relied on Para 12 (1999) 7 SCC 114 referred to Para 13 CIVIL APPELLATE JURISDICTION : Civil Appeal No. 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 Appellant. T.S.R. Venkatramana, G.S. Mani, R. Satish for the Respondents.

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REPORTABLE

 IN THE SUPREME COURT OF INDIA

 CIVIL APPELLATE JURISDICTION

 CIVIL APPEAL NO. 3192 OF 2010
 [Arising out of SLP (C) No. 1451 of 2009]

S. Kaladevi .... Appellant

 Vs.

V.R. Somasundaram & Ors. ....Respondents

 JUDGMENT

R.M. LODHA,J.

 Leave granted.

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

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

 1
execute a fresh sale deed with regard to the suit property in

pursuance of an agreement for sale dated 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. She also prayed for grant of

permanent injunction restraining the defendants from disturbing

with her peaceful possession and enjoyment of the suit property.

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 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 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 the matter with the

concerned party who had obtained attachment of the suit property

 2
and get the sale deed registered no sooner the attachment was

raised. The plaintiff averred that she called upon the defendants to

get the sale deed registered, but the defendants avoided the same

by putting forth the reason that attachment in respect of the suit

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 of the

suit property necessitating action by way of suit.

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 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

plaintiff's insistence that 1st defendant should execute an

agreement for sale in her favour, he and the 2nd defendant signed

the document believing that to be agreement for sale on

27.02.2006 and went to the office of Sub-Registrar for getting the

 3
agreement for sale registered. However, when the Sub-Registrar

asked the 1st 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 agree

for the registration 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 unregistered sale deed dated

27.02.2006 was tendered for being marked. The counsel for the

defendants objected to the said document being admitted 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 order of the

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

having regard to the proviso to Section 49 of the Registration Act,

 4
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.

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 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, 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 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

 5
office of Sub-Registrar without admitting the execution of the sale

deed and under these 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 1963 Act and

submitted that the provisions of 1963 Act would not override the

provisions of 1908 Act.

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 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:

 "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, or

 (b) confer any power to adopt, or

 6
 (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, 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."

11. The main provision in Section 49 provides that any

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 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 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
 7
also be admitted in evidence as an evidence of any collateral

transaction not required to be 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 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:-

 "......The High Courts of Calcutta, Bombay,
 Allahabad, Madras, Patna, Lahore, Assam, Nagpur,
 Pepsu, Rajasthan, Orissa, Rangoon and Jammu &
 Kashmir; the former Chief Court of Oudh; the Judicial
 Commissioner's 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 of the possession of the person who holds
 under it......"

1
 (2008) 8 SCC 564
 8
This Court then culled out the following principles:-

 "1. A document required to be registered, if
 unregistered is not admissible into evidence
 under 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.

 3. A collateral transaction must be independent
 of, or divisible from, the transaction to effect
 which the law required registration.

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

 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."

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.

13. In Kalavakurti Venkata Subbaiah v. Bala Gurappagari

Guruvi Reddy2, the question presented before this Court was

2
 (1999) 7 SCC 114
 9
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 sale deed.

The contention of the appellant, however, was that decree for

specific performance based on unregistered sale 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:-

 "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 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 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 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 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 not merely the registration of a sale deed,
 10
 but 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

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 presented by the
 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 cooperate
 with him in that regard. Therefore, various stages
 contemplated under Section 77 of the Act have not
 arisen in the present case 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 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
 itself constitute a contract to transfer the property.....
 ".

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 appropriate nor necessary for

us to consider the contention raised by learned counsel for the

 11
respondents about the maintainability of suit as framed by the

plaintiff or the circumstances in which the sale deed was executed.

If any issue in that regard has been struck 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, 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.

We fail to understand how the said provision helps the

respondents as the said provision provides that nothing in 1963

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 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

unregistered sale deed dated 27.2.2006 tendered by the plaintiff in

 12
her evidence and proceed with the suit accordingly. The parties

shall bear their own costs.
....................................J.
 [R.V. RAVEENDRAN] ....................................J.
 [R.M. LODHA]NEW DELHI
APRIL 12, 2010. 13

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