Jadho Singh vs Diwan Singh and Others

Aikman, J.—The suit out of which this appeal arises was brought by the plaintiff, who is respondent here, to recover money due to him under a mortgage-deed. The mortgage is dated the 14th of January 1893. The amount secured by it was less than 100 rupees, and the registration of the deed was not compulsory. It was not registered. On the 9th of January 1896, the appellants before me purchased the mortgaged property by a sale-deed which was registered. It has been found by the lower Court that the appellants, when they bought the property, had notice of the plaintiff�s mortgage.

The Lower Appellate Court, following a Full Bench decision of the Madras High Court Krishnamma v. Suranna ILR Mad. 148 has held that the fact of the defendants-appellants having notice of the plaintiff''s mortgage deprived them of the right to rely on the provisions of Section 50 of the Registration Act (Act No. III of 1877), which provides that certain documents shall, if duly registered, take effect as regards the property comprised therein against every unregistered document relating to the same property, not being a decree or order, whether such unregistered document be of the same nature as the registered document or not.

It is clear that this enactment makes no reference whatever to the holder of a subsequent registered document having notice of the prior unregistered one, and lays down broadly that the former shall have priority over the latter; but, notwithstanding this, the High Courts of Madras, Bombay and Calcutta vide the Madras ruling before quoted : for Bombay Hathising Sobhai v. Kuvarji Javher ILR 10 Bom. 105 and for Calcutta Abool Hossein v. Raghu Nath Sahu ILR Cal. 70 have considered themselves at liberty to apply the equitable doctrine of notice to cases like the present. These have, it would appear, been in a great measure influenced by the decisions of the English Courts; see in particular the case of The Agra Bank v. Barry I L.R. and IndAp 135. In that case (at p. 148) Lord Cairns observed that "by decisions which have now well established the law, it has been settled that, notwithstanding the apparent stringency of the words contained in the Act, still if a person registers a deed, and if at the time he registers the deed either he himself or an agent, whose knowledge is the knowledge of his principal, has notice of an earlier deed, which though executed is not registered, the registration which he actually effects will not give him priority over that earlier deed. "The ratio decidendi in that case was, it appears, that the object of registration laws being to give parties who enter into a transaction with regard to property notice of previous transactions concerning that property, that object is accomplished if the person who enters into a subsequent transaction has aliunde notice of a deed affecting the property and executed before his own. There is no case in this Court exactly in point, unless it be the decision in Ram Autar v. Dhanauri ILR All. 540 the facts of which are not quite on all fours with this case. There is, however, no decision of this Court on the question of notice as affecting the provisions of Section 50 of the Registration Act which is adverse to the decisions of the High Courts above referred to. Following those decisions I hold that the plea based on the provisions of Section 50 of the Registration Act must fail. The appeal is dismissed with costs.