The Supreme Court has held that immovable property rights cannot be transferred on the basis of an unregistered Agreement to Sell or on the basis of an unregistered General Power of Attorney. The case revolved around a dispute over possession and mesne profits, with the appellant asserting ownership based on an oral gift (Hiba) from his brother.
Facts of the Case:
An appeal was filed by the appellant to challenge the judgment and order passed by the High Court of Delhi. The High Court had affirmed the judgment and decree of the Trial Court, which decreed the suit for possession and mesne profits in favour of the respondent.
The appellant had claimed ownership of a property through an oral gift (Hiba) from his brother. The suit was based on documents such as a Power of Attorney, an agreement to sell, an affidavit, and a will executed in favour of the respondent, who was in possession of the disputed property.
Contentions of the Appellant:
The appellant had contested the suit before the Court arguing that the unregistered documents, including the Agreement to Sell, Power of Attorney, Affidavit, and Will, did not confer ownership rights upon the respondent. The appellant asserted ownership through an oral gift from his brother and contended that the suit was not maintainable due to the inadmissibility and non-enforceability of the documents under the law.
Contentions of the Respondent:
The respondent contended that the documents relied upon for the suit were customary and conferred complete title, asserting ownership of the property. Additionally, the respondent argued that a prohibition on the registration of transfer/conveyance documents in the property's area validated the transfers under customary documents, thereby conferring rightful ownership.
The respondent argued that the judgment in the case of Suraj Lamps & Industries Pvt. Ltd. Vs. State of Haryana and Anr.[1] had prospective application and would not impact the title acquired through the customary documents executed in 2008. The respondent asserted that the transfers under the customary documents predated the Suraj Lamps case and were, therefore, unaffected by its provisions, emphasizing the temporal distinction between the execution of the documents and the judgment's issuance.
Observations of the Court:
The Court held that, irrespective of the judgment in Suraj Lamps Case[2], no title could be transferred with respect to immovable properties based on unregistered documents such as the Agreement to Sell and the Power of Attorney.
The Court made reference to Section 17 and Section 49 of the Registration Act and Section 54 of the Transfer of Property Act to affirm that no right, title, or interest in immovable property can be conferred without a registered document.
The Court rejected the argument that the judgment in Suraj Lamps & Industries (supra) was prospective and stated that the requirement of compulsory registration and its effect on non-registration are statutory provisions derived from the Registration Act and the Transfer of Property Act. The Court clarified that the Suraj Lamps case merely approved these existing legal provisions and that earlier judgments of the Court had consistently held the same view. The Court rejected the notion that the prospective application of the Suraj Lamps case could override the statutory provisions governing registration and property transfers.
The Court held that the respondent could not maintain the suit for possession and mesne profits based on unregistered documents, even if they were registered. The documents, at best, could only serve as collateral evidence and not confer ownership rights.
The Decision of the Court:
The Supreme Court allowed the appeal, setting aside the High Court's judgment and dismissing the suit. The Court noted that the respondent could not maintain the suit based on unregistered documents and rejected the reasoning that the respondent filed the suit as an attorney for the brother.
Case Title: Shakeel Ahmed vs. Syed Akhlaq Hussain
Coram: Hon'ble Mr. Justice Vikram Nath and Hon'ble Mr. Justice Rajesh Bindal
Case no.: Civil Appeal No.1598 of 2023
Advocates for the Appellant: Mr. Anant Vijay Palli, Adv., Mr. Nikhil Palli, Adv., Mr. Nishant Kumar, Adv., Mr. Deepak Goel, AOR.
Advocates for the Respondents: Mr. Chandra Shekhar, Adv., Mr. Prashant Shekhar, Adv., Mr. Yogesh Pachauri, Adv., Mr. Sanjay Kumar Tyagi, AOR.
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[1] 183 (2011) DLT 1 (SC)
[2] Supra note 1
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