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2012 (1) TMI 170 - HC - Indian Laws
Capital gain - Whether the provision of Section 53-A of the TPA has any applicability on the facts of the present case? - specific performance of agreement to sell dated July 22nd 2008 executed by Sangeeta-defendant No.1 through her attorney Sharanjit Singh Sodhi in favour of the plaintiff with respect to the property mentioned in the head note of the plaint - Held that - Proviso to Section 49 of the Act makes the things more clear. It envisages that an unregistered document affecting immovable property and required by this Act or the TPA 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. A conjoint reading of Section 17(2)(v) and proviso to section 49 of the Act leaves no room for doubt that an agreement to sell property itself does not create any right title to the property. It is the sale-deed which when executed will create right title and interest in the property. Hence an agreement to sell is not required to be registered and the same is receivable in evidence in a suit for specific performance under Chapter II of the Specific Relief Act 1877. This Court would like to observe that the application itself is not maintainable as the same does not disclose any of the situations mentioned in Order 7 Rule 11 of the Code. The question as to whether the agreement to sell in question being unregistered was receivable in evidence was required to be adjudicated at the time of evidence as such the application (Annexure P-3) was not maintainable.
Issues Involved:
1. Rejection of plaint under Order 7 Rule 11 of the Code of Civil Procedure.
2. Requirement of registration for an agreement to sell containing a recital of possession under Section 17(1A) of the Registration Act, 1908.
3. Applicability of Section 53-A of the Transfer of Property Act, 1882, post-amendment.
4. Admissibility of an unregistered agreement to sell as evidence in a suit for specific performance.
Issue-wise Detailed Analysis:
1. Rejection of plaint under Order 7 Rule 11 of the Code of Civil Procedure:
The defendants No.1, 3, and 4 filed an application under Order 7 Rule 11 of the Code of Civil Procedure seeking rejection of the plaint on the grounds that the agreement to sell, which contained a recital of possession, required compulsory registration. The Civil Judge (Junior Division), Ludhiana, dismissed this application, leading to the revision petition by defendant No.4.
2. Requirement of registration for an agreement to sell containing a recital of possession under Section 17(1A) of the Registration Act, 1908:
The defendants argued that the agreement to sell, which mentioned the delivery of possession, necessitated registration under Section 17(1A) of the Registration Act, 1908. They contended that post-amendment, such agreements must be registered to be admissible as evidence affecting immovable property. The court examined the legislative amendments brought by Amendment Act No.48 of 2001, which mandated the registration of agreements to sell that contain recitals of possession.
3. Applicability of Section 53-A of the Transfer of Property Act, 1882, post-amendment:
The court analyzed Section 53-A of the Transfer of Property Act, 1882, which deals with the doctrine of part performance. Before the amendment, an unregistered agreement could still protect the possession of the transferee. However, post-amendment, the protection under Section 53-A is not available if the agreement is not registered. The court clarified that the plaintiff in the present case was seeking possession through specific performance of the agreement to sell, not protection of possession under Section 53-A.
4. Admissibility of an unregistered agreement to sell as evidence in a suit for specific performance:
The court emphasized that an agreement to sell, which does not itself create, declare, assign, limit, or extinguish any right, title, or interest in the property, does not require registration under Section 17(2)(v) of the Registration Act. The proviso to Section 49 of the Registration Act allows such unregistered agreements to be received as evidence of a contract in a suit for specific performance. The court distinguished between the protection of possession under an unregistered agreement and seeking specific performance of such an agreement.
Conclusion:
The court concluded that the application for rejection of the plaint was not maintainable under Order 7 Rule 11 of the Code of Civil Procedure. The issue of whether the unregistered agreement to sell was admissible as evidence was to be adjudicated during the evidence stage. The court upheld the order of the Civil Judge (Junior Division), Ludhiana, and dismissed the revision petition.