whether a compromise decree in respect of land which is not the subject-matter of suit but is part of the settlement between the family members requires compulsory registration in terms of Section 17(2)(vi) of the Registration Act, 1908.
The relevant provision of clause (v) and 3 clause (vi) of sub-clause (2) of Section 17 of the said Act reads as under: “17(2) Nothing in clauses (b) and (c) of sub-section (1) applies toxxx (v) any document other than the documents specified in sub-section (1A) not itself creating, declaring, assigning, limiting or extinguishing any right, title or interest of the value of one hundred rupees and upwards 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; (vi) any decree or order of a Court [except a decree or order expressed to be made on a compromise and comprising immovable property other than that which is the subject-matter of the suit or proceeding];” 7. We find that the judgment and decree passed by the High Court is clearly erroneous and cannot be sustained in law. The parties are the sons of late Vijendra Singh. As an heir of deceased, the appellant had a right in the estate left by the deceased. Therefore, it was not a new right being created for the first time when the parties entered into a compromise before the civil court but rather an pre-existing right in the property was recognized by way of settlement in court proceedings.
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO. 2336 OF 2021
(ARISING OUT OF SLP (CIVIL) No. 4035 OF 2017)
RIPUDAMAN SINGH
.....APPELLANT(S)
VERSUS
TIKKA MAHESHWAR CHAND
.....RESPONDENT(S)
O R D E R
Leave granted.
1. The plaintiff is in appeal before this Court challenging the judgment
and decree passed by the High Court on 28.10.2006 whereby
appeal filed by the defendant was allowed and the suit for
declaration challenging the orders passed in mutation proceedings
was dismissed.
2. The parties herein are the two sons of late Vijendra Singh. The
appellant filed a suit for possession in the year 1978 disputing the
Will dated 04.12.1958 executed in favour of the defendant. The
appellant claimed half share of the land as described in the plaint.
During the pendency of suit, a decree was passed on the basis of
compromise arrived at between the parties. The terms of
compromise read as under:
1
“The plaintiff shall be delivered possession of Khasra No.
513/1 area measuring 8 Kanals 18 Marlas as per Tatima
Ex.P-2 by the defendant and the plaintiff shall be
exclusive owner thereof and the defendant shall
continue to remain in physical possession as an owner
of Khasra No.513/2 area measuring 143 Kanals and 16
Marlas.
The plaintiff shall be owner of Khasra No. 516/1 area
measuring 27 Kanals 11 Marlas and the defendant shall
also pay to the plaintiff a sum of Rs.10,000/- within one
month from today. The plaintiff shall also be owner in
respect of the land recorded in the ownership of the
defendant in Patwars Dhaneta, Nohngi, Choru and
Saproh in respect of Ghair Mumkin Land.”
3. In pursuance of the decree so passed, the plaintiff sought a
mutation of the 1/2 share of the land vesting to him which was
allowed by the Naib Tehsildar on 10.02.1983. However, an appeal
against the said mutation was disposed of with a direction to Naib
Tehsildar to decide the mutation afresh as the mutation was
sanctioned without granting any opportunity of being heard to the
respondent.
4. The appellant thereafter filed an appeal before the Divisional
Commissioner. Such appeal was dismissed on the ground that the
compromise decree in the absence of registration is against the
provisions of the Registration Act, 1908. It was held as under:
“From the perusal of the record, it is revealed that the
decree passed by the Ld. Sub Judge in Civil Suit No. 45
of 1978 is a compromise decree concerning delivery of
possession of Khasra No.513/1 measuring 8 Kanals 18
Marlas and owner of Kh. No.516/1 measuring 27 Kanals
11 Marlas situated in patwars Dhaneta, Nohang, Choru
and Saproh in respect of Gair Mumkin Land. The present
appeal is in respect of other land which was not the
subject matter of suit in the civil court under section
2
17(2)(vi) of Indian Registration Act the compromise
decree which related to the subject matter of the suit
remained immune from registration. The compromise
decree which incorporated matters beyond the scope of
the suit, requires registration. Therefore, the land under
dispute which is beyond the scope of the suit or
compromise decree requires registration. The Assistant
Collector, IInd Grade Nadaun vide his orders dated
24.6.89 has sanctioned the mutation without the
registration of the compromise decree is against the
provision of the act ibid and the Ld. Collector has rightly
accepted the appeals of the respondent Tikka
Maheshwar Chand. Hence, these appeals are dismissed
and the order of the Collector dated 13.2.91 is upheld.”
5. The appellant subsequently filed a suit for declaration challenging
such order passed by the Commissioner. The suit was dismissed by
the learned Sub Judge, Ist Class, Hamirpur on 20.11.2002. But the
appeal preferred by the appellant was allowed by the learned
District Judge, Hamirpur in 19.08.2004. The said order was under
challenge in the second appeal before the High Court. The High
Court set aside the judgment and decree passed by the first
appellate court and the suit was dismissed on the ground that the
land even though being subject-matter of compromise, was not the
subject-matter of the suit and therefore the decree required
registration under Section 17(2)(vi) of the Registration Act, 1908.
6. The only question in the present appeal is whether a compromise
decree in respect of land which is not the subject-matter of suit but
is part of the settlement between the family members requires
compulsory registration in terms of Section 17(2)(vi) of the
Registration Act, 1908. The relevant provision of clause (v) and
3
clause (vi) of sub-clause (2) of Section 17 of the said Act reads as
under:
“17(2) Nothing in clauses (b) and (c) of sub-section (1)
applies toxxx
(v) any document other than the documents specified in
sub-section (1A) not itself creating, declaring, assigning,
limiting or extinguishing any right, title or interest of the
value of one hundred rupees and upwards 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;
(vi) any decree or order of a Court [except a decree or
order expressed to be made on a compromise and
comprising immovable property other than that which is
the subject-matter of the suit or proceeding];”
7. We find that the judgment and decree passed by the High Court is
clearly erroneous and cannot be sustained in law. The parties are
the sons of late Vijendra Singh. As an heir of deceased, the
appellant had a right in the estate left by the deceased. Therefore,
it was not a new right being created for the first time when the
parties entered into a compromise before the civil court but rather
an pre-existing right in the property was recognized by way of
settlement in court proceedings.
8. Though, the Gair Mumkin Land (Non-cultivable land) was not
subject-matter of the suit, but the compromise entered between
the parties before the learned Trial Court leading to decree on
3.11.1981 included such non-cultivable land. It is to be noted that
compromise decree can be passed even if the subject-matter of the
4
agreement, compromise of satisfaction is not the same as the
subject-matter of the suit in terms of the provisions of Order XXIII
Rule 3 of the Code of Civil Procedure, 1908. Order XXIII Rule 3 of
the Code of Civil Procedure, 1908 reads thus:
“3. Compromise of Suit. - Where it is proved to the
satisfaction of the Court that a suit has been adjusted wholly
or in part by any lawful agreement or compromise, in writing
and signed by the parties] or where the defendant satisfies
the plaintiff in respect of the whole or any part of the
subject-matter of the suit, the Court shall order such
agreement, compromise or satisfaction to be recorded, and
shall pass a decree in accordance therewith so far as it
relates to the parties to the suit, whether or not the subjectmatter of the agreement, compromise or satisfaction is the
same as the subject-matter of the suit:
xxx xxx.”
9. Therefore, the compromise decree entered into between the
parties in respect of land which was not the subject matter of the
suit is valid and is thus a legal settlement. It would be relevant to
notice that defendant-respondent has not disputed such settlement
on any admissible grounds before any forum.
10. The question whether such settlement between the members of
the family would require registration or not has come up for
consideration before this Court in a judgment reported in Kale and
Others v. Deputy Director of Consolidation and Others
1
which
reads as under:
“9…………The object of the arrangement is to protect
the family from long-drawn litigation or perpetual strifes
which mar the unity and solidarity of the family and
create hatred and bad blood between the various
1 (1976) 3 SCC 119
5
members of the family. Today when we are striving to
build up an egalitarian society and are trying for a
complete reconstruction of the society, to maintain and
uphold the unity and homogeneity of the family which
ultimately results in the unification of the society and,
therefore, of the entire country, is the prime need of the
hour. 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.
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) xxx xxx
(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
6
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.”
11. The said judgment has come up for consideration recently in a case
reported as Ravinder Kaur Grewal and Others v. Manjit Kaur
and Others
2
. It may be stated that this was not a case of
compromise decree but of a family settlement which was sought to
be enforced in a suit for declaration as one of the parties to the
settlement wanted to resile from it. Such family settlement was
held to be a document as per clause (v) of sub-section 2 of Section
17 of the Registration Act, 1908.
12. An aggrieved person can seek enforcement of family settlement in
a suit for declaration wherein the family members have some
2 (2020) 9 SCC 706
7
semblance of right in property or any pre-existing right in the
property. The family members could enter into settlement during
the pendency of the proceedings before the Civil Court as well.
Such settlement would be binding within the members of the
family. If a document is sought to be enforced which is not
recognized by a decree, the provision of clause (v) of sub-section 2
of Section 17 of the Registration Act, 1908 would be applicable.
However, where the decree has been passed in respect of family
property, clause (vi) of sub-section 2 of Section 17 of the
Registration Act, 1908 would be applicable. The principle is based
on the fact that family settlement only declares the rights which
are already possessed by the parties.
13. In respect of a question whether the decree requires registration or
not, this Court in Bhoop Singh v. Ram Singh Major and Others
3
held that decree or order including compromise decree creating
new right, title or interest in praesenti in immovable property of
value of Rs.100/- or above is compulsory for registration. It was not
the case any pre-existing right but right that has been created by
the decree alone. This court explained both the situation, where a
part has pre-existing right and where no such right exists. It was
observed as under:
“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
3 (1995) 5 SCC 709
8
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.
xx xx xx
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 would think that the exception engrafted is meant
to cover that decree or order of a court, including a decree
or order expressed to be made on a compromise, which
declares the pre-existing right and does not by itself create
new right, title or interest in praesenti 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.
xx xx xx
18. The legal position qua clause (vi) can, on the basis of
the aforesaid discussion, be summarized as below:
(1) Compromise decree if bona fide, in the sense that the
compromise is not a device to obviate payment of stamp
duty and frustrate the law relating to registration, would not
require registration. In a converse situation, it would require
registration.
(2) If the compromise decree were to create for the first
time right, title or interest in immovable property of the
value of Rs 100 or upwards in favour of any party to the suit
the decree or order would require registration.
(3) If the decree were not to attract any of the clauses of
sub-section (1) of Section 17, as was the position in the
aforesaid Privy Council and this Court’s cases, it is apparent
that the decree would not require registration.
(4) If the decree were not to embody the terms of
compromise, as was the position in Lahore case, benefit
from the terms of compromise cannot be derived, even if a
suit were to be disposed of because of the compromise in
question.
(5) If the property dealt with by the decree be not the
“subject-matter of the suit or proceeding”, clause (vi) of sub9
section (2) would not operate, because of the amendment of
this clause by Act 21 of 1929, which has its origin in the
aforesaid decision of the Privy Council, according to which
the original clause would have been attracted, even if it
were to encompass property not litigated.
19. Now, let us see whether on the strength of the decree
passed in Suit No. 215 of 1973, the petitioner could sustain
his case as put up in his written statement in the present
suit, despite the decree not having been registered.
According to us, it cannot for two reasons:
(1) The decree having purported to create right or title in
the plaintiff for the first time that is not being a declaration
of pre-existing right, did require registration. It may also be
pointed out that the first suit cannot really be said to have
been decreed on the basis of compromise, as the suit was
decreed “in view of the written statement filed by the
defendant admitting the claim of the plaintiff to be correct”.
Decreeing of suit in such a situation is covered by Order 12
Rule 6, and not by Order 23 Rule 3, which deals with
compromise of suit, whereas the former is on the subject of
judgment on admissions.
(2) xxx xxx ”
14. In K. Raghunandan and Others v. Ali Hussain Sabir and
Others
4
, a decree was passed in respect of disputes between the
two neighbours over passage. It was held that such decree would
require registration.
“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. Subsection (2) of Section 17 of the Act excludes only the
applications of clauses (b) and (c) and not clause (e) of subsection (1) of Section 17. If a right is created by a
compromise decree or is extinguished, it must compulsorily
be registered if the compromise decree comprises
immovable property which was not the subject-matter of the
suit or proceeding. 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
4 (2008) 13 SCC 102
10
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.”
15. The judgments of this Court in Bhoop Singh and K.
Raghunandan was found to be inconsistent in an order reported
in Phool Patti and Another v. Ram Singh (Dead) Through
Lrs. and Another
5
and the matter was thus referred to a larger
Bench. The larger Bench in the judgment reported as Phool Patti
and Another v. Ram Singh (Dead) Through Lrs. and Another
6
did not find inconsistencies between the two judgments.
16. Bhoop Singh was a case dealing with both the situations, decree
between the parties where the decree holder does not have any
pre-existing right in the property and also the situation where
decree holder has a pre-existing right. It was the second situation
where the decree holder has a pre-existing right in the property, it
was found that decree does not require registration. In K.
Raghunandan case, the dispute was not amongst the family
members but between neighbours regarding right over passage.
Obviously, none of them had any pre-existing right over the
immovable property in question.
17. In view of enunciation of law in Bhoop Singh’s case, we find that
the judgment and decree of the High Court holding that the decree
requires compulsory registration is erroneous in law. The
5 (2009) 13 SCC 22
6 (2015) 3 SCC 465
11
compromise was between the two brothers consequent to death of
their father and no right was being created in praesenti for the first
time, thus not requiring compulsory registration. Consequently, the
appeal is allowed and the suit is decreed.
.............................................J.
(SANJAY KISHAN KAUL)
.............................................J.
(HEMANT GUPTA)
NEW DELHI;
JULY 6, 2021.
12
