K. RAGHUNANDAN AND ORS. v. ALI HUSSAIN SABIR AND ORS

Citation: [2008] 8 S.C.R. 657

Court: Supreme Court of India

Bench: S.B. SINHA, LOKESHWAR SINGH PANTA

Case summary

K. RAGHUNANDAN AND ORS. v. ALI HUSSAIN SABIR AND ORS.pdf

Judgment text

[2008] 8 S. C. R. 657 K. RAGHUNANDAN AND ORS. V. ALI HUSSAIN SABIR AND ORS. (Civil Appeal No. 3572 Of 2008) MAY 14, 2008 [S. B. SINHA AND LOKESHWAR SINGH PANTA, JJ. ) Registration Act, 1940- s. 17(2)- Suit for declaration that suit passage was private property ofplaintiff in terms of a compromise decree - Decreed - First appellate Court opined that suit passage was not subject matter of compromise and thus did not confer any ex. elusive right over it - LPA dismissed by High Court holding that compromise decree being not registered, no claim relying on the basis thereof could form basis of the suit- Correctness of- Held: Correct- It is admitted by plaintiff that in compromise decree there was no mention of suit passage - Building plan submitted by plaintiff before municipality show that suit passage was a public road - Finding offact arrived at by CCJurts below that passage was not private property- In terms of s.

17(2), compromise entered into in respect of immovable property comprising other than that which was subject matter of suit or proceeding requires registration -As in this case not only there existed a dispute with regard to title over the passage and the suit passage having not found the part of the compromise there is no infirmity in the impugned iudgment - Code of Civil Procedure, 1908 - Code of Civil Procedure Amendment Act, 1976. The plaintiffs-appellants and defendants-respondents were neighbours. The dispute between them related to a passage. A suit for perpetual injunction was filed, which ended in a compromise. A map was annexed to the consent terms. All the properties shown in the red were accepted to be the properties of the plaintiffs and the defendants had allegedly agreed not to interfere with their possession. It was stated that a passage was shown i to be the exclusive property of the plaintiffs.

The respondents fixed a door making an opening on the purported private passage belonging to the appellants. Respondents contended that the appellants have 8 no exclusive right over the scheduled property i. e. passage measuring 80 yards and that it was a common passage. Appellants filed a suit for declaration that the suit passage shown in red in the plaint was their private property. Respondents filed a suit for perpetual injunction seeking injunction againstthe appellants from interfering with their usage of the passage. The trial Court by common judgment decreed the suit filed by appellants and dismissed the suit of respondents, holding that the compromise 0 decree conferred a right on the appellants in respect of passage in question. The respondents filed appeals. The First appellate Court opined that the suit passage was not . the subject matter of compromise and in any event the same did not confer any exclusive right, title and interest thereto upon the appellants.

High Court dismissed the LPAs on the premise that the compromise decree being not registered, no claim relying on the basis thereof could form the basis of the suit. Hence the present appeal. Dismissing the appeal, the Court HELD: 1. 1. The portion marked in red was allotted to the plaintiffs- appellants and that marked in green was allotted to the defendants-respondents. Appellant No. 1, examined himself as PW-1. He admitted that in the compromise memo there was no mention about the suit passage. He also admitted that he had. not claimed the suit passage . in the said suit. He also admitted that his vendor had provided the suit passage for his use. A finding . of fact has been arrived at that the passage was not shown either in the areas demarcated in red or green. [Para 14] [665-C,D,E] AND ORS. 1. 2. With a view to determine the issue as to whether the passage could have been the subject matter of compromise, the parties adduced evidence.

The building plan submitted by the appellants before the Municipality was brought on record. The passage was shown _as a road which means a public road. A finding of fact had been arrived at that there was nothing on record to show that the passage was a private one. The High Court, rightly came to the conclusion that the plan must be read in terms of the memo filed and as the passage did not form part of the building plan, prima facie, it was common to both. It has furthermore been found that the defendants had no other motorable road for approach to their factory. [Para 15] [665-E-H] 2. 1 Sub-section (2) of s. 17 of the Registration Act, 1908 carves out an exception therefrom stating that nothing in clauses (b) and (c) of Sub-section (1) of s. 17 would apply to "any decree or order of a Court except a decree or order expressed to be made on a compromise and comprising immovable property other thah that which is the subject-matter of the suit or proceeding".

Even if the passage was not the subject matter of the suit, indisputably, in terms of the Code of Civil Procedure Amendment Act, 1976, a compromise decree was permissible. A plain reading of the saic;I provision clearly shows that a property which is not the subject matter of the suit or a proceeding would come within the purview of exception contained in clause (vi) of Sub-section (2) of s. 17 of the Act. If a compromise is entered into in respect of an immovable property, comprising other than "that which was the subject matter of the suit or the proceeding, the same would require registration. The said provision was inserted by Act 21 of 1929. [Paras 17,18] [667-8-E] 2. 2 The Code of Civil Procedure Amendment Act, 1976 does not and cannot override the provisions of the Act.

The purported passage being not the subject matter of the suit, if sought to be transferred by the defendants - respondents in favour of the plaintiffs- appellants or if by -1 reason thereof they have relinquished their own rights and recognized the rights of the plaintiffs-appellants, registration thereof was imperative. The First Appellate Court held so. The High Court also accepted the said findings. Therefore, it was not correct in cont. ending that the High Court has not gone into the said question. The High Court clearly affirmed the findings of fact arrived at by the First Appellate Court. [Paras 19,20] [667-E,F,G] 3. 1. Appellants have given up their claim of 150 yards of land which was to be on the rear side of the property and in lieu thereof the passage was exclusively given to the plaintiffs-appellants. Thus, the appellants have rested its case on the basis of an exchange of land between the plaintiffs and defendants.

The High Court opined that as by reason thereof an inference can be drawn that the defendants who had been in possession of the passage had given up their rights in lieu of 150 yards of land, the same would constitute a transfer of property and, thus, necessitated registration. [Para 21] [668-E,F] 3. 2. If the consent terms create a right for the first time as contra-distinguished from recognition of a right, registration thereof would be required, if the value of the property is Rs. 100/- and upwards. [Para 23] [669-8,CJ Ramdas Sah and Anr. v: Jagamath Prasad and Ors. AIR 1960 Patna 179; M. Pappu Reddiar (died) and Ors. v. Amaravathi Ammal and Ors. AIR 1971 Madras 182 - held inapplicable. Bhoop Singh v. Ram Singh Major and Ors. (1995) 5 SCC 709; Som Dev and Ors. v: Rati Ram and Anr (2006) 10 SCC 788; Tulsan v: Pyare Lal and Ors. (2006) 10 SCC 782; Shankar Sitaram Sontakke and Anr v: Balkrishna Sitaram Sontakke and Ors.

(1955) 1 SCR 99; Raja Sri Sailendra Narayan Bhanja Deo v: The State of Orissa (1956) SCR 73; Gurdev Kar::r v. Mehar Singfl AIR (1989) P&H 324; Ranbir Singh v. Shri r Chand (1984) Pun LJ 562; Sumintabai Ramkrishna Jadhav v. Rakhmabai Ramkrishna Jadhav AIR (1981) Born 52- referred to. 3. 3. A statute must be construed having regard to the purpose and object thereof. Sub-section (1) of s. 17 of the • Act makes registration of the documents compulsory. Subsection (2) of s. 17 of the Act excludes only the applications of. Clauses (b) and (c) and not clause (e) of Sub-section (1) of s. 17. If a right is created by a compromise decree or is extinguished, it must compulsorily be registered. Clause (vi) is an exception to the exception. If the latter part of Clause (vi) of Sub-section (2) of s. 17 of the Act applies, the first part thereof shall not apply.

As in this case not only there exists a dispute with regard to the title of the parties over the passage and the passage, itself, having not found the part of the compromise, there is no infirmity in the impugned judgment. [Para 29] [675-B·D] CIVILAPPELLATE JURISDICTION: Civil Appeal No. 3572 of 2008 From the final Judgment and Order dated 31. 3. 2001 & 24. 6. 2005 of the High Court of Judicature, Andhra Pradesh at Hyderabad in LPA No. 163 &229 of 2000 & Review CMP No. 591 of 2002 respectively ... H. S. Gururaja Rao, Y. Raja Gopala Rao, Y. Ramesh and Y Vismai for the Appellants. P. S. Narsimha, Somiran Sharma, Aribam Guneshwar Sharma for the Respondents. The Judgment of the Court was delivered by S. B. SINHA, J : 1. Leave granted. 2. Application of Section 17(2){vi) of the Registration Act, 1908 (for short "the Act") in the facts and circumstances of this case is in question· in this appeal which arises out of a judgment and order dated 31. 03.

2001 passed by the High Court of Andhra Pradesh at Hyderabad in L. P. A. Nos. 163 and 229 of 2000. 3. Appellants are neighbours. The dispute between the parties relate to a passage. Plaintiffs·- Appellants claimed to have purchased 590 sq. yards of premises No. 5-4-413 . to 415 8 at Nampally, Hyderabad from one P. N. Vijaya Lakshmi. Alleg- edly, another 259 sq. yards of land was also purchased by them from the said vendor. When they had been proceeding with the construction of the building, allegedly, respondents interfered. A suit bearing No. OS No. 76 of 1975 was filed claiming for a decree for perpetual injunction. The said suit ended in a compromise, the terms whereof are as under: "1. That the portion marked Green in the plan shall be exclusively enjoyed by the Defendant without any interference from the plaintiffs. The plaintiffs hereby admit that this portion of land marked Greer in the plan attached with the Memo of compromise belongs to the Defendant No.

1 and his brother Sri Noman Ali son of Sri Abdul Khader, Defendant No. 2. 2. That the portion marked Red will be enjoyed by the plaintiffs exclusively without any interference with the Defendants or his agents. 3. That all other claims against Defendant in the suit are hereby withdrawn by the plaintiffs. " 4. A map was annexed to the consent terms. All the properties shown in the red were accepted to be the properties of the plaintiffs and the defendants had allegedly agreed not to interfere with their possession. It was stated that a passage running from north to south connecting Mukarrarnjahi Road was shown to be the exclusive property of the plaintiffs. It was furthermore al- _. leged that the respondents' father was a tenant in the premises bearing No. 5-4-412. The said property was purchased by the respondent No. 1 in a public auction held on 8. 11. 1957. The extent of the land which was the subject matter is in dispute. AND ORS. [S. S. SINHA, J] t- 5.

Respondents admittedly had constructed shops on Moajamjahi road with a huge opening on the main road. The defendants despite the said consent terms made attempt to fix an old door on the eastern side of their wall making an opening on the purported private passage belonging to the appellants. Respondents, however, contended that the appellants have ~ no exclusive right over the scheduled property, i. e. , passage measuring 80 yards situated at Nampally, Hyderabad. According to them, the passage in question was a common passage. 6. Appellants filed a suit which was marked as O. S. No. 341 of 1993 for adeclaration that the suit passage, as shown in the red marked A, 8, C and D'in the plaint is their private property. 7. Respondents filed a suit for perpetual injunction which was marked as O. S. No. 1132 of 1993, and renumbered as . J. Q,S. No. 769 of 1994, seeking injunction against the appel- ! ants from interfering with their usage of the passage.

It was alleged that the appellants tampered with the plan by adding the word "plaintiffs" above the word "passage" in the plan. 8. The said suits were consolidated; the claims of the parties having common issues. The issues framed were: "In O. S. No. 341/93 1) ·Whether the plaintiffs are entitled for the relief of declaration as prayed for? 2) Whether the plaintiffs are entitled for perpetual injunction as prayed for? 3) Whether the plaintiffs are entitled for mandatory injunction as prayed for? 4) To what relief? t In O. S. No. 769/1994 1) \/Vhether the plaintiffs are entitled for the relief of perpetual injunction as prayed for? ~ 2) To what relief? " The learned Senior Civil Judge, City Civil Court, Hyderabad by a common judgment decreed O. S. No. 341 of 1993 and dismissed the suit filed by the respondents viz. O. S. No. 769of1994. 9. Appeals were preferred thereagainst by the respondents.. Whereas the learned Trial Judge held that the compro- ..

_ mise decree conferred a right on the appellants in respect of the passage in question, the First Appellate Court opined that the suit passage was no~ the subject matter of compromise and in any event the same did not confer any exclusive right, title and interest thereto U! Jon the appellants. · 10. Two Letters Patent Appeals were preferred thereagainst by the appellants, which have been dismissed by reason of the impugned judgment inter alia on the premise that the ).. compromise decree being not registered, no claim relying on or on the basis thereof could form the basis of the suit. 11. Mr. H. S. Gururcija Rao, learned senior counsel appearing on behalf of the appellants, would submit that a consent decree not only operates as estoppel by judgment, even the general principles of res judicata would be applicable. The High Court, it was submitted, thus, committed a serious error in relying on the decision of this Cou1i in Bhoop Singh v.

Ram Singh Major and Others [(1995) 5 SCC 709] which ), has been distinguished in Som Dev and Others v. Rafi Ram and Another [(2006) 10 SCC 788] and, thus, the impugned judgment cannot be sustained. 12. Mr. P. S. Narsimha, learned counsel appearing on behalf of the respondents, on the other hand, submitted that the First Appellate Court having arrived at a question of fact that the plaintiffs - appellants did not derive any right, title and inter- i est in the passage by reason of the said compromise and/ or in .. any event the plaintiffs - appellants having not claimed any right, title and interest thereupon in the suit, the compromise decree required registration. 13. O. S. No. 76 of 1975 admittedly was a suit for injunction. The plaint of the said suit is not before us. It, however, appears from the judgment of the First Appellate Court that the passage was not the subject matter of compromise in the said O. S. No. 76of1975. This fact is not disputed. 14.

The First Appellate Court as also the High Court analysed the materials brought on record. The question which would arise for our consideration is as to what would be the effect of admitted case of the parties that the suit passage was not the subject matter thereof. We have noticed hereinbefore that the parties joined issues as to whether the word "plaintiffs" was added before the word "passage" in the plan annexed to the consent terms or not. We have also noticed hereinbefore that the portion marked in red was allotted to the plaintiffs- appellants and that marked in green was allotted to the defendants - respondents. Appellant No. 1, examined himself as PW-1. He admitted that in the compromise memo there was no mention about the suit passage. He also admitted that he had not claimed the suit passage in the said suit. He also admitted that his vendor had provided the suit passage for his use.

A finding of fact has been arrived at that the passage was not shown either in the areas demarcated in red or green. 15. With a view to determine the issue as to whether the passage could have been the subject matter of compromise, the parties adduced evidence. The building plan submitted by the appellants before the Municipality was brought on record. The passage was shown as a road which means a public road. A finding of fact had been arrived at that there was nothing on record to show that the passage was a private one. The High Court, in our opinion, rightly came to the conclusion that the plan must be read in terms of the memo filed and as the passage did not form part of the building plan, prima facie, it was common to both. It has furtbermore been found that the defendants had no other motorable road for approach to their factory which is being run on premises No. 5-4-412. 16.

Sub-section (1) of Section 17 of the Act specifies the documents of which registration is compulsory; clauses (b), (c) and (e) whereof read as under: "17 - Documents of which registration is compulsory (1) The following documents shall be registered, if the property to which they relate is situate in a district in which, and if they have been executed on or after the date on which, Act No. XVI of 1864, or the Indian Registration Act, 1866, or the Indian Registration Act, 1871, or the Indian Registration Act, 1877, or this Act came or comes into force, namely:- (a) *** (b) other non-testamentary instruments which purport or operate to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property; (c) non-testamentary instruments which acknowledge the receipt or p umintabai Ramkrishna Jadhav v.

Rakhmabai Ramkrishna Jadhav [AIR 1981 Born 52] held: "13. In other words, the court must enquire whether a document has recorded unqualified and unconditional . words of present demise of right, title and interest in the property and included the essential terms of the same; if the document, including a compromise memo, extinguishes the rights of one and seeks to confer right, title or interest in praesenti in favour of the other, relating to immovable property of the value of Rs 100 and upwards, the document or record or compromise memo shall be compulsorily registered. " • It was further observed: "16. We have to view the reach of clause (vi), which is an exception to sub-section (1 ), bearing all the aforesaid in mind. We wopId think that the exception engrafted is meant to cover that. £1.

'ecree or order of a court, includin~ a decree or order expressed to be made on a compromise, which declares the~re-existing right and does not by itself create ' new right, tiff~ or interest in praesenti in immovable property ... of the valu_e. 'bf Rs 100 or upwards. Any other view would find the m~chief of avoidance of registration, which requires payment of stamp duty, embedded in the decree or order. 17. It would, therefore, be the duty of the court to examine in each case whether the parties have pre-existing right to the imr:nov~bl~ property, or whether under the orde. ,r or decree oftbe court one party having right, title or interest therein agreed or suffered to ~xtinguish the same and created right, title or interest in praesenti in immovable property of the value of Rs 100 or upwards in favour of other party for the first time, either by compromise or pretended consent. If latter be the position, the document ·. is compulsorily registrable. " •· } ~' . I AND ORS. [S. B.

SfNHA, J] )>. 28. The decision of this Court in Som Dev (supra) did not lay down any law which runs contrary to or inconsistent with the law laid down in Bhoop Singh (supra). Bhoop Singh (supra) was distinguished on fact stating: "18. Therefore, it was a case of the right being created by the decree for the first time unlike in the present case. In para 13 of that judgment it is stated that the Court must enquire whether a document has recorded unqualified and unconditional words of present demise of right, title and interest in the property and if the document extinguishes that right of one and seeks to confer it on the other, it requires registration. But with respect, it must be pointed out that a decree or order of a court does not require registration if it is not based on a compromise on the ground that clauses (b) and (c) of Section 17 of the Registration Act are attracted.

Even a decree on compromise does not require registration if it does not take in property that is not the subject-matter of the suit. A decree or order of a court is normally binding on those who are parties to it unless it is shown by resort to Section 44 of the Evidence Act that the same is one without .. , jurisdiction or is vitiated by fraud or ·collusion or that it is "! avoidable on any ground known to law. But otherwise that decree is operative and going by. the plain language of Section 17 of the Registration Act, particularly, in the context of sub-clause (vi) of sub-section (2) in the background of the legislative history, it cannot be said that a decree based on admission requires registration. On the facts of that case, it is seen that their Lordships proceeded on the basis that it was the decree on admission that created the title for the first time.

It is obvious that it was treated as a case coming under Section • 17(1 )(a) of the Act, though the scope of Section 17(2)(v1) of the Act was discussed in detail. But on the facts of this case, as we have indicated and as found by the courts, it is not a case of a decree creating for the first time a """""""'( right, title or interest in the present plaintiffand his brother. The present is a case where they were putting forward in the suit a right based on an earlier transaction of relinquishment or family arrangement by which they had acquired interest in the property scheduled to that plaint. Clearly, Section 17(1)(a) is not attracted ... " (emphasis supplied} In Som Dev (supra}, the plaintiff claimed half share in the property. The defence was that the right of the plaintiff having been created under a compromise and the same having not been registered the same could not be enforced as against the contesting defendants or their assignor, the other co-owner.

The High Court opined thatthe suit was based on a family settlement which did not require registration and, thus, would come within the purview of Section 17(2}(vi} of the Act. It was on the 0 basis of the said finding of fact, the law was laid down stating: "... Of course, we are not unmindful of the line of authorities that say that even if there is inclusion of property that is not the subject-matter of the suit, if it constitutes the . E consideration for the compromise, such a compromise decree would be considered to be a compromise relating to the subject-matter of the suit and such a decree would also not require registration in view of clause (v1) of Section 17(2) of the Registration Act Since we are not concerned with that aspect here, it is not necessary to further deal with that question.

Suffice it to say that on a plain reading of-clause (vt) of Section 17(2) all decrees and orders of the court including a compromise decree subject to the exception as regards properties that are outside the subject-matter of the suit, do not require registration on the ground that they are hit by Sections '17(1 )(b) and (c) of the Act. But at ·the same time, there is no exemption or exclusion, in respect of clauses (a), (d) and (e} of Section 17(1) so that if a decree brings about a gift of immovable properly, or lease of immovable property from yea( to year or for a term exceeding one year or reserving an early rent or a transfer of a decree or order of a court or any award creating, declaring, assigning, limiting or extinguishing rights to and in immovable property, that requires to be registered. " 8 29. A statute must be construed having regard to the purpose and object thereof. Sub-section (1) of Section 17 of the Act makes registration of the documents compulsory.

Sub-section (2) of Section 17 of the Act excludes only the applications of Clauses (b) and (c) and not clause (e) of Sub-section (1) of Section 17. If a right is created by a compromise decree or is extinguished, it must compulsorily be registered. Clause (vi) is an exception to the exception. If the latter part of Clause (vi) of Sub-section (2) of Section 17 of the Act applies, the first part thereof shall not apply. As in this case not only there exists a dispute with regard to the title of the parties over the passage and the passage, itself, having not found the part of the compromise, we do not find any infirmity in the impugned judgment. The appeal is accordingly dismissed with costs. Counsel's fee assessed at Rs. 25,000/-. D. G. Appeal dismissed