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2011 DIGILAW 2373 (RAJ)

Sudhir Kumar v. Shyam Sunder

2011-11-08

MAHESH BHAGWATI

body2011
JUDGMENT 1. - Challenge in this writ petition is to the order dated 1st December, 2006 whereby the learned Additional District Judge, Khetri, allowed the application of the respondent-defendant filed under Section 35 of Indian Stamp Act and Section 17 of the Registration Act and 49 of Registration Act. 2. Adumbrated in brief, the case of the plaintiff-petitioner is that the defendant-respondent agreed to sell his house for a consideration of Rs. 1,25,000/- to the petitioner-plaintiff and accepted the sale consideration by executing and signing the Agreement to Sell in his favour. Since the defendant-respondent did not fulfill the conditions of agreement, he filed a suit for specific performance of contract and possession of the suit property against the respondent-defendant in the Court of Additional District Judge, Khetri. During evidence, the respondent-defendant filed an application under Section 35 of Indian Stamps Act and Section 17 and 49 of Registration Act stating that the documents in question i.e. agreement and sale letter, were unregistered and not duly stamped, hence, the same were not admissible in evidence and the petitioner-plaintiff should not be allowed to exhibit the same. The learned trial Court allowed the application of the respondent-defendant declaring the said documents to be inadmissible in evidence as the same were unregistered and were not duly stamped. The petitioner has impugned the said order in the instant writ petition. 3. A very short question which springs up for consideration in the instant writ petition is "as to whether unregistered agreement to sell is admissible in evidence in a suit for specific performance of contract?" 4. Learned counsel for the petitioner canvassed that a document, even if it is required to be registered and is unregistered, can be admitted in evidence in a suit for specific performance of contract. He has cited the case of S. Kaladevi v. V.R. Somasundaram & Ors. reported in AIR 2010 SC, 1654 in support thereof. 5. E-converso, the learned counsel for the respondents defended the impugned order and stated the same to be just and proper, which called for no intervention. 6. He has cited the case of S. Kaladevi v. V.R. Somasundaram & Ors. reported in AIR 2010 SC, 1654 in support thereof. 5. E-converso, the learned counsel for the respondents defended the impugned order and stated the same to be just and proper, which called for no intervention. 6. It is true that the documents containing contracts to transfer for consideration, any immovable property for the purpose of Section 53A of the Transfer of Property Act, 1882, is required to be registered under Section 17 of the Registration Act, 1908, but the proviso to Section 49 of the Act exempts a document from its registration and as such, an unregistered document is permissible to be received as evidence of a contract in a suit for specific performance. The learned trial Court has rightly understood the spirit of Section 17 of the Registration Act but committed error while not relying on the judgment of S. Kaladevi (Supra). 7. In the case of S. Kaladevi (Supra), the Hon'ble Apex Court has categorically observed that: "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." 8. The Hon'ble Apex Court after analyzing aforesaid provisions of law ad-longum, culled out certain principles, where the document can be received in evidence and further added one more principle in certain terms thus: "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." 9. Thus, so far as the question of admissibility of an unregistered document i.e. an unregistered agreement to sale in evidence, is concerned, it is now well settled that there is no prohibition under Section 49 of the Registration Act, to receive an unregistered document in evidence as evidence of an Agreement in a suit for specific performance, but when the question of an instrument to be chargeable with duty, arises, Section 35 of the Stamp Act mandates that an instrument chargeable with duty should be stamped so as to make it admissible in evidence. Proviso A to Section 35 of the Stamp Act enables a document to be received in evidence on payment of stamp duty and penalty if the document is chargeable but not stamped or on payment of deficit duty and penalty, if it is insufficiently stamped. The bar against the admissibility of an instrument which is chargeable with stamp duty and is not stamped, is, of course absolute whatever be the nature of the purpose, be it for main or collateral purpose, unless the requirements of proviso (A) to Section 35 are complied with. It follows that if the requirements of Proviso (A) to Section 35 are satisfied, then the document which is chargeable with duty, but not stamped, can be received in evidence." 10. Learned counsel for the petitioner fairly conceded during arguments that he was prepared to impound the document and pay the stamp duty as per the provisions of law. Thus, in a situation alike that in the case on hand, the learned trial Court ought to have declared the unregistered agreement to sell in question to be admissible in evidence and pass an order invoking the relevant provisions of the Stamp Act directing the petitioner-plaintiff to pay the stamp duty and penalty in accordance with the provisions of law. 11. Issue no. 4 is related to law and the learned trial court ought to have decided the issue in conformity with the provisions of Registration Act as also the Stamp Act. 11. Issue no. 4 is related to law and the learned trial court ought to have decided the issue in conformity with the provisions of Registration Act as also the Stamp Act. The impugned order is found not to have been passed in conformity with the provisions of relevant laws and thus, the impugned order suffers from serious infirmity and the case is remitted to the learned trial court with the direction that the court should adjudicate issue no.4 afresh in accordance with law and the law laid down by the Hon'ble Apex Court in the case of S. Kaladevi (supra) after affording an opportunity of being heard to both the parties. 12. For the reasons afore-stated, the writ petition succeeds and the impugned order dated 1st December, 2006 is ordered to be set aside. 13. The learned trial Court is directed to pass an order afresh with regard to the admissibility of the said documents in evidence in accordance with the provisions of law after affording an opportunity of being heard to both the parties. 14. Consequent upon the disposal of the writ petition, the stay application does not survive and the same also stands disposed of.Petition allowed. *******