Madho Rao vs Bhao deceased L.R. and Others

This appeal is on behalf of the Plaintiff in a suit for specific performance and it is directed against the judgment and decree of the learned Civil and Sessions Judge, Aurangabad, dated the 10th Dai 1353-F. by which he affirmed the judgment and decree of the District Judge of Aurangabad dated 24th Amardad, 1352-F. dismissing the suit on the preliminary ground that the suit document being unregistered could not be received in evidence.

The material facts necessary for the disposal of this appeal may be stated as follows: Plaintiff''s case was that a sum of Rs. 720415-3 I. G. equivalent to H. Section Rs. 8357-10-3 was due to him from Defendants 1 and 2 the father of Defendants 3 to 6 who sold Survey No. 7 excluding 2 to 3 bighas and Survey Nos. 72, 73, 79 and 80 situate in Chencholi Limbaji, Kannad Taluq in extinguishment of the debt by a document dated 16th Ardibehest 1347-F. and put the Plaintiff in possession of the lands sold and promised to execute a regular sale-deed and get it registered when demanded by the Plaintiff. The demand it was alleged was made in the month of Khurdad 1347- F. but instead of complying with it, the Defendants wrongfully dispossessed the vendee from the lands.

The Defendants traversed these allegations. They further raised the plea that the document being unregistered was not admissible in evidence and that the alleged sale being in contravention of the provisions of Dastural Amal-e-Inteqal Arzi was void and consequently unenforceable.

Both the Courts below have given effect to the former plea on the authority of - Shivappa v. Anna 29 DLR 819 (A) in which a Bench of this Court following - Dayal Singh v. Indar Singh AIR 1926 PC 94 (B) held that an agreement for sale acknowledging the receipt of earnest money created a charge on the Immovable property u/s 55 CI. (6) (b), T. P. Act, and therefore did of itself create an interest in property and requires registration and if such an agreement happens to be unregistered, it is inadmissible in evidence in a suit for specific performance relating to the property agreed to be sold.

The learned Advocate for the Appellant in the first place argued that the Courts below have failed to take note of the fact that the document upon which the Plaintiff had based his claim came into existence on 16th Ardibehest 1347-P., and by that time a proviso has been added to Section 43 of the Hyderabad Registration Act enabling an unregistered document to be given as evidence of a contract in a suit for specific performance under Chapter II of the Hyderabad Relief Act.

The force of this contention must be conceded. The suit document came into being on 16th Ardibehest 1347-F., attracting the proviso to Section 43, Hyderabad Registration Act which was introduced by the amending Act 3 of 1346-F. in the following words:

provided that an unregistered document affecting immovable property and required by this Act or the Hyderabad Transfer of Property Act to be registered may be received as evidence of a contract in a suit for specific performance under Chapter II of the Hyderabad Relief Act.

The amending Act came into force on 19th Dal 1346-F. It is thus clear that the provision applied and the suit being for specific performance, the document was admissible in evidence. The case of - 29 DLR. 819 (A) dealt with a situation which had arisen before the Amending Act came into force and in view of the amendment o f Section 43, Hyderabad Registration Act, it cannot be regarded to be good law. But the real difficulty which lies in the path of Appellant is that he has not followed the procedure provided by Ss. 66 to 68 Hyderabad Registration Act corresponding to Ss. 71, 76 and 77 of the Indian Registration Act.

The learned Advocate for the Appellant argued that the document by itself did not create any right or interest in immovable property, but merely created a right to obtain another document and was covered by Sub''-s. 2 (1), CI. (5) of Section 10, Hyderabad Registration Act and therefore the provisions of Ss. 66 to 68 of the Act were not attracted.. The provisions of Clause (5) above referred to are as follows:

Nothing in Clauses (b) & (c) of Sub-section (1) applies to any document not itself creating, declaring, assigning, limiting or extinguishing any right, title or interest of the value of onehundred rupees and upward 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".

In the light of these provisions, we have to see whether the document in question merely creates a right to obtain another document without creating or declaring any right, title or interest in the dispute property. The document after mentioning the asnount of debt and the person from whom it was due and enumerating the lands intended to be sold recites that the vendors have sold the lands in extinguishment of the debt and put the vendee in possession, the result of which is described to. be that the vendee had become the owner with full powers of alienation and the vendors had become divested of every title and interest in the property sold and that a registered sale-deed will be executed when demanded by the vendee.

It would thus appear that the document em- bodies a complete sale and not merely an execu- tory contract. In such a case, it seems difficult to agree with the contention that the document falls within the purview of Sub-Section 2 (1), Clause (5) of Section 10 of the Registration Act. It can neither be said to be a contract for sale within the meaning of Section 54, Hyderabad Transfer of Property Act. That section defines it in the following words:

A contract for the sale of immovable property is a contract that a sale of such property shall take place on terms settled between the parties. It does not by itself create any interest in or charge on such property".

The tenor of document as referred to above shows that not only terms were settled, but transfer of ownership effected in exchange for a price. In -- Horsfall v. Hey (1848) 154 ER 705 (C) it has been held that if the parties to an instrument have so expressed themselves as to make it apparent on the face of the instrument that the writing was intended to be the record of the transfer then being made, the instrument will operate as a convayance and it is immaterial whether the words used be in the past tense or in the present tense. At this stage, the question of registration assumes importance. It is argued on behalf of the Appellant that under the document discussed above, it was part of the obligation of the Respondents to get the deed that was in contemplation by the agreement drawn up, executed and registered. Section 27 (c) of the Hyderabad Stamp Act provides that in the case of sale the expense for providing the stamp shall be borne by the transferee. Paragraph 1, Clause (d) of Section 55 of the Hyderabad Transfer of Property Act makes it the duty of the buyer to prepare a conveyance and tender it to the seller for execution. The Appellant-buyer instead of complying with the above provisions of law contented himself with a sale-deed upon a plain paper; It has been observed in the case of - Valambalachi Vs. Duraiswami Pillai and Another, by Srinivasa Aiyangar, J. that "If a document duly executed by vendor is tendered by the vendor to the purchaser and the delivery of the document is accepted by the purchaser, we must take it that the purchaser who accepts the document undertakes to see the registration himself, he feeling assured that he has got provisions of Registration Act, under which he can compel the other party to the contract to come and register the document. I am therefore inclined to regard that in all cases, Where the purchaser of property accepts an unregistered document he may be regarded as, relieving the other party, the vendor from his obligation to tender a registered document in performance of the contract. It seems to me impossible to accede to the contention that a person who agrees to sell and convey property is bound not only to execute a proper conveyanceonce but go on executing as many conveyances as may be required by the vendee in respect of. that property.

It is contended by the learned Advocate for the Appellant that the document in question contains an express promise to execute and register a. fresh document. Therefore the above case is distinguishable on facts. But in our opinion, the insertion of that promise does not detract from the executed nature of the written contract. The argument of the learned Advocate would have-carried force if the agreement were of an executory-nature. In this connection, we may with advantage quote the observations of Parker J. in - Von Hatzfeld Widenberg v. Alexander 1912 VI Ch 284 at p. 288 (E) which have been quoted-with appproval by their Lordships of the Privy Council in - AIR 1933 29 (Privy Council) . Parker J. states:

It appears to be well settled by the authorities. that if the document or letters relied on as-constituting a contract contemplate the execution of a further contract between the parties it is a question of construction whether the execution of a further contract is a condition or term of a bargain or whether it is mere expression of the desire of the parties as to the manner in which the transaction already agreed: to will in fact go through. In the former case there is no enforceable contract either because the condition is unfulfilled or because the law does not recognise a contract to enter into a contract, In the latter case there is a binding contract and the reference to a more formal document may be ignored.

It is next contended for the Appellant that the absence of registration of the suit document cannot have an adverse effect on his suit because according to the proviso added to Section 43, Hyderabad Registration Act, by the amending Act 3 of 1346-F an unregistered document can be received as evidence of a contract in a suit for specific performance. In support of this contention reliance, is placed on - Sheikh Hashim. v. Bhagwan Rao 40 DLR 391 (G) and - Babu Rao v. Sonaji AIR 1952 Hyd 48 (H). These cases are distinguishable on the ground that in these cases the disputed agreements were held to be contracts for sale. In the present case, the document embodies the sale by which nothing more was to be done by the Respondent except the registration of the document. Ignoring the fact that he had failed to supply the necessary stamp the question arises whether the Appellant was bound to have recourse to statutory remedy provided by the Registra- tion Act before coming into the Court for the equitable relief of specific performance. This Court has consistently taken the view that any person seeking the registration of a document embodying a sale must pursue the statutory remedy before he comes to the Court for specific performance. Reference in this connection may be made to - Muryam Bi v. Syed Khawja 5 Aeen-e-Deccan 570 (I), -''Narsagowd v. Raghupat Reddy 24 DLR 717 (J), - Churappa v. Narain 33 DLR G68 (K) and - Maroti v. Honaji 40 DLR 412 (L). It was contended by the Appellant that these authorities have lost their binding force either because they were decided before the proviso was added to Section 43 of the Hyderabad Registration Act or they have failed to take note of the proviso. This argument makes no difference, because the question now is not of admissibility of the document but of the statutory remedy which was available to the Appellant and which he has failed to adopt, The view adopted by our High Court is in accordance with the view of the Madras High Court in - Satyanaraysna v. Venkat Rao AIR 1923 Mad 530 (M), which is further supported by a Bench decision of the same High Court in the case of - Venkadari Somappa Vs. The Official Receiver of Bellary, . The learned Advocate for the ap- pellant refers to - Venkatasheshayya v. Dis-trict Board, East Godawari AIR 1939 Mad 391 (O), - Vakacherla Venkatasubbamma and Another Vs. Gobbooru Subbiah, and - Jhaman Mahton Vs. Amrit Mahton and Others, for the contrary view. We need not consider these authorities because so far as our High Court is concerned, the question ap- pears to have been well settled. For these reasons, we dismiss the appeal with costs.