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Tuesday, June 26, 2012

unregistered sale deed= "collateral purpose" as under: "1. A document required to be registered, if unregistered is not admissible into evidence under Section 49 of the Registration Act. 2. Such unregistered document can however be used as an evidence for collateral purpose as provided in the proviso to Section 49 of the Registration Act. 3. A collateral transaction must be independent of, or divisible from, the transaction to effect which the law required registration. 4. A collateral transaction must be a transaction not itself required to be effected by a registered document, that is, a transaction creating, etc., any right, title or interest in immovable property of the value of one hundred rupees and upwards. 5. If a document is inadmissible in evidence for want of registration, none of its terms can be admitted in evidence and that to use a document for the purpose of proving an important clause would not be using it as a collateral purpose."


THE HON'BLE MR JUSTICE C.V.NAGARJUNA REDDY          

Civil Revision Petition No.176 of 2012

13.03.2012

 Doma Govinda Raju and another

Vanimisetti Papa Rao and others

^Counsel for the Petitioners:  Sri P.Govind Reddy
                                                                       
!Counsel for respondent No.2: Sri S.Subba Reddy

Cases referred?

1 (2008) 8 SCC 564
2 2006 (1) ALT 76
3 AIR 1942 Bombay 268  
4 (2003) 4 SCC 161


ORDER:
This civil revision petition arises out of order, dated 18.07.2011, in
O.S.No.108 of 2008, on the file of the learned XI Additional District Judge
(Fast Track Court), Kakinada.
Respondent Nos.1 to 13 filed the above-mentioned suit for declaration of title
and for recovery of possession.  The petitioners are defendant Nos.3 and 4 in
the said suit.  For convenience, the parties are referred to as they are arrayed
in the suit.
One of the pleas raised by the plaintiffs is that their ancestor, Vanimisetti
Chakrapani Rao, has purchased the suit property through unregistered sale deed,
dated 30.06.1960, and that since then, he and thereafter, they were in
uninterrupted possession of the same and thereby perfected their title through
adverse possession.  It is their further plea that defendant Nos.1 and 2 i.e.,
State of Andhra Pradesh and the Tahsildar, ought not to have granted assignment
in favour of defendant Nos.3 and 4.  During the course of evidence, the
plaintiffs sought to introduce the unregistered sale deed, dated 30.06.1960, in
evidence.  This was opposed by defendant Nos.3 and 4 on the ground that the said
document, which is in the nature of sale deed, is unregistered and hence, the
same is not admissible in evidence.  The lower Court rejected the said objection
by holding that under proviso to Section 49 of the Registration Act, 1908 (for
short 'the Act'), even an unregistered document affecting the immovable property
can be received for collateral purpose.  Feeling aggrieved by the said order,
the present civil revision petition is filed by defendant Nos.3 and 4.
At the hearing, Sri P.Govinda Reddy, learned counsel for the petitioners, placed
reliance on the judgment of the Supreme Court K.B.Saha and Sons Private Limited
v. Development Consultant Limited1, the judgment of this Court in Netrambaka
Krishnaiah v. Nellore Audinarayana2, and also the judgment of the Bombay High
Court in V.H.Deshpande v. R.D.Deshpande3.
Opposing the above submissions, Sri S.Subba Reddy, learned counsel for
respondent No.2, relied upon the judgment of the Supreme Court in Bondar Singh &
others v. Nihal Singh and others4.
I have carefully considered the respective submissions of the learned counsel
for the parties.
The plaintiffs have claimed two main reliefs in the suit which appeared to be
mutually contradictory, namely, declaration of title through adverse possession
and for recovery of possession.  They sought to rely upon the unregistered sale
deed referred to above for the purpose of establishing their possession
eventually to get their title declared through adverse possession.  Under
proviso to Section 49 of the Act, even an unregistered document is admissible in
evidence for collateral purpose.
The learned counsel for the petitioners stated that the purpose of respondent
Nos.1 to 13 to rely upon the unregistered sale deed is to establish their
possession, which in turn will help them to get their title declared through
adverse possession.  The learned counsel, therefore, submitted that the purpose
of placing reliance on the said document is for obtaining one of the main
reliefs in the suit and hence, the same cannot be said to be for collateral
purpose.
In K.B.Saha and Sons Private Limited (1 supra), the Supreme Court has deduced
the principles as to what constitute "collateral purpose" as under:
"1. A document required to be registered, if unregistered is not admissible into
evidence under Section 49 of the Registration Act.
2. Such unregistered document can however be used as an evidence for collateral
purpose as provided in the proviso to Section 49 of the Registration Act.
3. A collateral transaction must be independent of, or divisible from, the
transaction to effect which the law required registration.
4. A collateral transaction must be a transaction not itself required to be
effected by a registered document, that is, a transaction creating, etc., any
right, title or interest in immovable property of the value of one hundred
rupees and upwards.
5. If a document is inadmissible in evidence for want of registration, none of
its terms can be admitted in evidence and that to use a document for the purpose
of proving an important clause would not be using it as a collateral purpose."

In V.H.Deshpande (3 supra), the Bombay High Court explained the collateral
purpose referred to in proviso to Section 49 of the Act as any purpose other
than that of creating, declaring, assigning, limiting or extinguishing a right
to immovable property.  Referring to the said judgment, this Court Netrambaka
Krishnaiah (2 supra), held that if a document is purporting to create an
interest in the immovable property, it is inadmissible in evidence for want of
registration.
While the legal principles do not admit of divergent opinion, the whole problem
arises in their application.  Each one of the principles laid down by the Courts
needs to be carefully considered in order to segregate the main purpose from
collateral purpose.
In the instant case, the unregistered document was not pressed into service for
seeking declaration of the plaintiffs' title.  The same is sought to be relied
upon for the purpose of establishing possession of their ancestor.  This by
itself cannot be said to be the main purpose, which is directly relatable to the
main relief claimed by the plaintiffs.  It may be, as submitted by Sri.P.Govind
Reddy, learned counsel for the petitioners, that eventually establishment of
factum of possession on the strength of the said document may lead to the
plaintiffs succeeding in their suit for getting their title declared through
adverse possession.  In my opinion, that by itself would not constitute the main
purpose.  What is sought to be proved by the plaintiffs through the said
document was only the possession.  No other aspect arising out of the said
document, much less the title is sought to be relied upon by the plaintiffs.
In almost an identical case dealt with by the Supreme Court in Bondar Singh (4
supra), it has allowed such a document to be admitted in evidence for proving
possession.  That was also a case where a suit was filed for declaration
claiming that the plaintiffs have become owners of the suit land by adverse
possession and sought injunction restraining the defendants from interfering
with their possession.  The plaintiffs sought to rely upon the unregistered sale
deed, dated 09.05.1931, executed by the father of the defendants in favour of
their predecessor-in-interest in order to prove possession.  When the said
document was sought to be admitted in evidence, an objection similar to the one
which is raised in the present case as to its admissibility was raised.  While
dealing with the said objection, the Supreme Court held in para-5 as under:
"...Under the law a sale deed is required to be properly stamped and registered
before it can convey title to the vendee.  However, legal position is clear law
that a document like the sale deed in the present case, even though not
admissible in evidence, can be looked into for collateral purposes...."

The learned counsel for the petitioners sought to distinguish between the
present case and the one decided by the Supreme Court by stating that while in
the latter case, relief of permanent injunction was claimed, in the present
case, one of the reliefs claimed by the plaintiffs is recovery of possession.
In my opinion, the ratio laid down by the Supreme Court applies even though the
nature of one of the reliefs claimed in the present case is at variance with
that claimed in the case before the Supreme Court.  In both the cases, the
plaintiffs sought to establish their rights through adverse possession.  In
order to prove their possession, they wanted to rely upon the unregistered sale
deed.  Therefore, irrespective of whether the plaintiffs in the case on hand
sought for recovery of possession, obviously as an alternative relief, the ratio
laid down by the Supreme Court will still apply to the present case.
For the above-mentioned reasons, I do not find any error in the order of the
lower Court in admitting the unregistered sale deed in evidence.  Accordingly,
the civil revision petition is dismissed.
As a sequel to dismissal of the civil revision petition, interim order, dated
24.01.2012, shall stand vacated and C.R.P.M.P.No.242 of 2012 shall stand
disposed of as infructuous.

C.V.NAGARJUNA REDDY, J    
13th March, 2012