Showing posts with label registration. Show all posts
Showing posts with label registration. Show all posts

09 October 2020

sale certificate of any property sold by a public auction by a civil or revenue officer does not require registration and for its registration requisite stamp duty cannot be insisted by the registrar

Even the aforesaid Section though mandatory in nature provides which of the documents are compulsorily to be registered, but it does not include sale by auction and sale certificate issued by the concerned authority including confirmation of the sale which are outcome of auction proceedings conducted in terms of the Court's order. The provision is speaking one and without any ambiguity, thus, registration was not required.[Para No.8]

     The issue raised in this petition is no longer res integra and is squarely covered by the judgment of the Hon'ble Supreme Court in Som Dev and others vs. Rati Ram and another (2006) 10 SCC 788 and thereafter in a subsequent judgment B. Arvind Kumar vs. Govt. of India and others (2007) 5 SCC 745 which judgments, in turn, have been considered by learned Division Bench of this Court in Valley Iron & Steel Company Ltd. vs. State of Himachal Pradesh and other (2016) 5 ILR 1639, and the relevant observations are as under:-
"24. Learned Senior Counsel appearing on behalf of the writ petitioner argued that the authorities concerned have refused to register the sale and make the entries in the revenue records on the ground that the necessary permission was to be obtained as per the mandate of Section 118 of the Act.

25. It is also contended that the sale certificate and the confirmation of sale issued by the authorities, i.e. Annexures P6 and P8, are necessary to be registered before the authority concerned in terms of the mandate of Section 17 of the Registration Act, 1908 (for short "the Registration Act"), which is not legally correct.


26. Section 17 of the Registration Act, though mandatory in nature, provides which of the documents are compulsory to be registered. It does not include sale by auction and sale certificate issued by the concerned authorities including confirmation of sale, which are outcome of the auction proceedings conducted in terms of Court orders.
sale certificate of any property sold by a public auction by a civil or revenue officer does not require registration and for its registration requisite stamp duty cannot be insisted by the registrar
The provision is speaking one and without any ambiguity. Thus, registration was not required. The Apex Court in the case titled as B. Arvind Kumar versus Govt. of India and others, 2007 5 SCC 745 , held that a sale certificate issued by a Court or an officer authorized by the Court does not require registration. It is apt to reproduce para 12 of the judgment herein:
"12. The plaintiff has produced the original registered sale certificate dated 29.8.1941 executed by the Official Receiver, Civil Station, Bangalore. The said deed certifies that Bhowrilal (father of plaintiff) was the highest bidder at an auction sale held on 22.8.1941, in respect of the right, title, interest of the insolvent Anraj Sankla, namely the leasehold right in the property described in the schedule to the certificate (suit property), that his bid of Rs. 8,350.00 was accepted and the sale was confirmed by the District Judge, Civil and Military Station, Bangalore on 25.8.1941. The sale certificate declared Bhowrilal to be the owner of the leasehold right in respect of the suit property. When a property is sold by public auction in pursuance of an order of the court and the bid is accepted and the sale is confirmed by the court in favour of the purchaser, the sale becomes absolute and the title vests in the purchaser. A sale certificate is issued to the purchaser only when the sale becomes absolute. The sale certificate is merely the evidence of such title. It is well settled that when an auction purchaser derives title on confirmation of sale in his favour, and a sale certificate is issued evidencing such sale and title, no further deed of transfer from the court is contemplated or required. In this case, the sale certificate itself was registered, though such a sale certificate issued by a court or an officer authorized by the court, does not require registration. Section 17(2)(xii) of the Registration Act, 1908 specifically provides that a certificate of sale granted to any purchaser of any property sold by a public auction by a civil or revenue officer does not fall under the category of non testamentary documents which require registration under subsec. (b) and (c) of sec. 17(1) of the said Act. We therefore hold that the High Court committed a serious error in holding that the sale certificate did not convey any right, title or interest to plaintiff's father for want of a registered deed of transfer."

28. The same principle has been laid down by the Apex Court in the case titled as Som Dev and others versus Rati Ram and another, 2006 10 SCC 788 . It would be profitable to reproduce para 15 of the judgment herein:
"15. Almost the whole of the argument on behalf of the appellants here, is based on the ratio of the decision of this Court in Bhoop Singh v. Ram Singh Major, 1995 5 SCC 709 , It was held in that case that exception under clause (vi) of Section 17(2) of the Act is meant to cover that decree or order of a Court including the decree or order expressed to be made on a compromise which declares the preexisting right and does not by itself create new right, title or interest in praesent in immovable property of the value of Rs.100/ or upwards. Any other view would find the mischief of avoidance of registration which requires payment of stamp duty embedded in the decree or order. It would, therefore, be the duty of the Court to examine in each case whether the parties had preexisting right to the immovable property or whether under the order or decree of the Court one party having right, title or interest therein agreed or suffered to extinguish the same and created a right in praesenti in immovable property of the value of Rs.100/ or upwards in favour of the other party for the first time either by compromise or pretended consent. If latter be the position, the document is compulsorily registrable. Their Lordships referred to the decisions of this Court in regard to the family arrangements and whether such family arrangements require to be compulsorily registered and also the decision relating to an award. With respect, we may point out that an award does not come within the exception contained in clause (vi) of Section 17(2) of the Registration act and the exception therein is confined to decrees or orders of a Court. Understood in the context of the decision in Hemanta Kumari Debi v. Midnapur Zamindari Co. Ltd., 1919 AIR(PC) 79 and the subsequent amendment brought about in the provision, the position that emerges is that a decree or order of a court is exempted from registration even if clauses (b)and (c) of Section 17(1) of the Registration Act are attracted, and even a compromise decree comes under the exception, unless, of course, it takes in any immovable property that is not the subject matter of the suit.

 

29. A question arose before the Madras High Court in a case titled as K. Chidambara Manickam versus Shakeena & Ors., 2008 AIR(Mad) 108 , whether the sale of secured assets in public auction which ended in issuance of a sale certificate is a complete and absolute sale or whether the sale would become final only on the registration of the sale certificate? It has been held that the sale becomes final when it is confirmed in favour of the auction purchaser, he is vested with rights in relation to the property purchased in auction on issuance of the sale certificate and becomes the absolute owner of the property. The sale certificate does not require any registration. It is apt to reproduce paras 10.13, 10.14, 10.17 and 10.18 of the judgment herein:-
"10.13 Part III of the Registration Act speaks of the Registration of documents. Section 17(1) of the Registration Act enumerates the documents which require compulsory Registration. However, subsection (2) of Section 10 sets out the documents to which clause (b) and (c) of subsection (1) of Section 17 do not apply. Clause (xii) of subsection (2) of Section 17 of the Registration Act reads as under:
"Section 17(2)(xii) any certificate of sale granted to the purchaser of any property sold by public auction by a Civil or Revenue Officer."

10.14 A Division Bench of this Court in Arumugham, S. v. C.K. Venugopal Chetty,1994 1 LW 491 , held that the property transferred by Official Assignee, under order of Court, does not require registration under Section 17 of the Registration Act. The Division Bench has held as follows:

02 October 2020

Oral evidence can be given about any fact which would invalidate or contradict the proved or registered document

In respect of registered document (Exh.35), learned Counsel for the appellant has submitted that it is a registered document and therefore, contents therein cannot be contradicted. Sections 91 and 92 of the Indian Evidence Act are material sections in respect of oral evidence of the documents reduced into writing. If the document is proved as per Section 91, then oral evidence as per Section 92 is not permitted to contradict the document but proviso (1) of Section 92 permits to contradict the document. It reads as under :
 92.Exclusion of evidence of oral agreement.-When the terms of any such contract, grant or other disposition of property, or any matter required by law to be reduced to the form of a document, have been proved according to the last section, no evidence of any oral agreement or statement shall be admitted, as between the parties to any such instrument or their representatives in interest, for the purpose of contradicting, varying, adding to, or subtracting from, its terms: 
Oral evidence can be given about any fact which would invalidate or contradict the proved or registered document
     Proviso  (1). - Any fact may be proved which would invalidate any document, or which would entitle any person to any decree or order relating thereto; such as fraud, intimidation, illegality, want of due execution, want of capacity in any contracting party, [want or failure] of consideration, or mistake in fact or law.
[Para No.16]

    As per Section 92 Proviso (1), evidence can be adduced to contradict the document. Learned Counsel for the respondents has pointed out the decision in the case of Vithal Saidu Lokhande (cited supra). This Court has held that oral evidence as per the provisions of Section 92 Proviso (1) is applicable and the defendants can adduce the oral evidence to contradict the document. This Court in the case of Vithal Saidu Lokhande (cited supra) has held that "Plea to invalidate any document proved in accordance with section 91 is available where a case is made out of fraud, intimidation, illegality, want of due execution, want of capacity in any contracting party, want or failure of consideration, or mistake in fact or law. It is further held that "proviso (1) of Section 92 permits leading of parol evidence of any fact which would invalidate any document, at the instance of any party to such document of their representatives in interest. Proviso (4) does not deal with the question of invalidating any document but it relates to the existence of any distinct subsequent oral agreement to rescind or modify any such contract, grant or disposition of property. It makes the parol evidence admissible to show that the prior written contract has been waived or replaced by subsequent oral agreement with a rider that, if a matter has been reduced into writing because the law requires it to be in writing for its validity, no oral evidence can be given of any subsequent agreement, rescinding or modifying it. It can only be waived, rescinded, modified or altered by another written agreement of equally solemn character. The rule applies to all registered instruments, whether or not, registration is compulsory under the law. "[Para No.17]

01 August 2020

Oral family-settlement and its memorandum does not require registration

Be that as it may, the High Court has clearly misapplied the dictum in the relied upon decisions. The settled legal position is that when by virtue of a family settlement or arrangement, members of a family descending from a common ancestor or a near relation seek to sink their differences and disputes, settle and resolve their conflicting claims or disputed titles once and for all in order to buy peace of mind and bring about complete harmony and goodwill in the family, such arrangement ought to be governed by a special equity peculiar to them and would be enforced if honestly made. The object of such arrangement is to protect the family from long drawn litigation or perpetual strives which mar the unity and solidarity of the family and create hatred and bad blood between the various members of the family, as observed in Kale (supra). In the said reported decision, a three­Judge Bench of this Court had observed thus: ­ “9. ….. A family arrangement by which the property is equitably divided between the various contenders so as to achieve an equal distribution of wealth instead of concentrating the same in the hands of a few is undoubtedly a milestone in the administration of social justice. That is why the term “family” has to be understood in a wider sense so as to include within its fold not only close relations or legal heirs but even those persons who may have some sort of antecedent title, a semblance of a claim or even if they have a spes successionis so that future disputes are sealed for ever and the family instead of fighting claims inter se and wasting time, money and energy on such fruitless or futile litigation is able to devote its attention to more constructive work in the larger interest of the country. The courts have, therefore, leaned in favour of upholding a family arrangement instead of disturbing the same on technical or trivial grounds. Where the courts find that the family arrangement suffers from a legal lacuna or a formal defect the rule of estoppel is pressed into service and is applied to shut out plea of the person who being a party to family arrangement seeks to unsettle a settled dispute and claims to revoke the family arrangement under which he has himself enjoyed some material benefits. …..” (emphasis supplied) In paragraph 10 of the said decision, the Court has delineated the contours of essentials of a family settlement as follows: ­ “10. In other words to put the binding effect and the essentials of a family settlement in a concretised form, the matter may be reduced into the form of the following propositions:

“(1) The family settlement must be a bona fide one so as to resolve family disputes and rival claims by a fair and equitable division or allotment of properties between the various members of the family;
(2) The said settlement must be voluntary and should not be induced by fraud, coercion or undue influence;
(3) The family arrangement may be even oral in which case no registration is necessary;
Oral family-settlement and its memorandum does not require registration
(4) It is well­ settled that registration would be necessary only if the terms of the family arrangement are reduced into writing. Here also, a distinction should be made between a document containing the terms and recitals of a family arrangement made under the document and a mere memorandum prepared after the family arrangement had already been made either for the purpose of the record or for information of the court for making necessary mutation. In such a case the memorandum itself does not create or extinguish any rights in immovable properties and therefore does not fall within the mischief of Section 17(2) of the Registration Act and is, therefore, not compulsorily registrable;
(5) The members who may be parties to the family arrangement must have some antecedent title, claim or interest even a possible claim in the property which is acknowledged by the parties to the settlement. Even if one of the parties to the settlement has no title but under the arrangement the other party relinquishes all its claims or titles in favour of such a person and acknowledges him to be the sole owner, then the antecedent title must be assumed and the family arrangement will be upheld and the courts will find no difficulty in giving assent to the same;
(6) Even if bona fide disputes, present or possible, which may not involve legal claims are settled by a bona fide family arrangement which is fair and equitable the family arrangement is final and binding on the parties to the settlement.” (emphasis supplied) Again, in paragraph 24, this Court restated that a family arrangement being binding on the parties, clearly operates as an estoppel, so as to preclude any of the parties who have taken advantage under the agreement from revoking or challenging the same. In paragraph 35, the Court noted as follows: ­ “35. … We have already pointed out that this Court has widened the concept of an antecedent title by holding that an antecedent title would be assumed in a person who may not have any title but who has been allotted a particular property by other party to the family arrangement by relinquishing his claim in favour of such a donee. In such a case the party in whose favour the relinquishment is made would be assumed to have an antecedent title. …..” And again, in paragraph 36, the Court noted as follows: ­ “36. … Yet having regard to the near relationship which the brother and the son­in­law bore to the widow the Privy Council held that the family settlement by which the properties were divided between these three parties was a valid one. In the instant case also putting the case of Respondents Nos. 4 and 5 at the highest, the position is that Lachman died leaving a grandson and two daughters. Assuming that the grandson had no legal title, so long as the daughters were there, still as the settlement was made to end the disputes and to benefit all the near relations of the family, it would be sustained as a valid and binding family settlement. …” While rejecting the argument regarding inapplicability of principle of estoppel, the Court observed as follows: ­ “38. … Assuming, however, that the said document was compulsorily registrable the courts have generally held that a family arrangement being binding on the parties to it would operate as an estoppel by preventing the parties after having taken advantage under the arrangement to resile from the same or try to revoke it. …..” (emphasis supplied) And in paragraph 42, the Court observed as follows: ­
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