Madhya Pradesh High Court
Dhaniram vs Ram Dayal on 27 October, 2025
Author: Gurpal Singh Ahluwalia
Bench: G. S. Ahluwalia
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IN THE HIGH COURT OF MADHYA PRADESH
AT GWALIOR
BEFORE
HON'BLE SHRI JUSTICE G. S. AHLUWALIA
ON THE 27th OF OCTOBER, 2025
SECOND APPEAL No. 1661 of 2018
DHANIRAM
Versus
RAM DAYAL AND OTHERS
Appearance:
Shri Prashant Sharma - Advocate for the appellant.
Shri Akshat Kumar Jain - Advocate for the respondents 1-4.
Shri Sanjay Singh Kushwaha - Government Advocate for the
respondent 5/State.
JUDGMENT
Heard through video conferencing.
2. This Second Appeal has been filed under Section 100 of CPC
against the judgment and decree dated 9/5/2018 passed by Sixth Additional
District Judge, Shivpuri, District Shivpuri in Civil Appeal No.34/2015, by
which the judgment and decree dated 9/7/2015 passed by Civil Judge, Class-
II, Pohari, District Shivpuri in RCSA No.8A/2014 has been modified.
3. The appellant is the plaintiff, who has suffered modification of
decree by the First Appellate Court.
4. The facts necessary for disposal of the present appeal in short are
that the plaintiff filed a suit for specific performance of contract in respect of
land bearing survey No.205 area 0.99 hectare situated in village Nagar,
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Tehsil Pohari, District Shivpuri. It was his case that on 4/1/2012, an
agreement to sale was executed in respect of the land in dispute . Later on,
the defendant nos.1 to 3 executed a sale deed dated 5/3/2013 in favour of
defendant no.4 and another sale deed dated 11/9/2014 was executed by
defendant no.2 in favor of defendant no.4. It was also claimed that both the
sale deeds may be declared as null and void. The undisputed fact is that out
of 0.99 hectares of land situated in village Nagar, Tehsil Pohari, District
Shivpuri , the defendants no.1 to 4 had their share to the extent of 0.87
hectare. Subsequent to the agreement to sell Ex. P.1, defendants no.1 to 3
have sold their share to defendant no.4 by registered sale deed dated
5/3/2013 and defendant no.5 has sold her share to defendant no.4 by
registered sale deed dated 11/9/2014. It is the case of the plaintiff that he is in
possession of 0.99 hectare of land forming part of survey No.205. Although
he was in possession from 1/7/2000, but the ownership was of defendants
and accordingly, defendants no.1 to 4 entered into an agreement to sale their
shares, i.e.7/8 (0.87 hectare) for a consideration amount of Rs.1,10,000/- and
demanded RS.55,000/- by way of advance. Accordingly, on 4/1/2012 the
defendants no.1 to 4 executed a notarized agreement to sale in respect of
their share for a consideration of Rs.1,10,000/-. The sale deed was to be
executed within a period of two years from the date of execution of
agreement to sale. Although the plaintiff had requested the defendants no.1
to 4 on multiple occasions for execution of the sale deed, but they always
avoided to do the same and accordingly, on 20/12/2013 the plaintiff sent a
registered notice to the defendants no.1 to 4 for execution of sale deed after
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receiving the remaining amount of Rs.55,000/-, but the sale deed was not
executed, therefore, in the year 2014 the plaintiff again made a request to
defendants no.1 to 4, but on the festival of Shivratri they refused to execute
the sale deed and accordingly, with an intention to create further
complications the defendants no.1 to 3 alienated their share to defendant no.4
by registered sale deed dated 5/3/2013 and defendant no.5 also executed a
sale deed in favour of defendant no.4 on 11/9/2014. It was claimed that since
both the sale deeds are subsequent to agreement to sale entered into between
the parties, therefore, they are null and void and are not binding on the
plaintiff. The plaintiff is ready and willing to get the sale deed executed by
making payment of remaining consideration amount of Rs.55,000/-.
5. Defendants no.1 to 4 filed their written statement and claimed that
the plaintiff is not in possession of the property in dispute from 1/7/2000 and
they also denied execution of agreement to sale. It was claimed that the
agreement to sale is a forged document. The defendant no.4 is the owner of
the property in dispute and he is in possession of the same.
6. The defendants no.5 and 6 remained ex parte and they did not file
their written statement.
7. After framing issues and recording evidence of the parties, Civil
Judge, Class-II, Porsa, District Shivpuri by judgment and decree dated
9/7/2015 passed in RCSA No.8A/2014 decreed the suit and held that the
defendants no.1 to 4 shall execute the sale deed in respect of their respective
share within a period of two months from the date of the decree, failing
which the plaintiff shall be entitled to get the sale deed executed through
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Court. It was further held that the sale deed dated 5/3/2013, executed by the
defendants no.1 to 3 in favour of defendant no.4 is null and void, except to
the extent of share of defendant no.5-Prem. It was also held that the sale deed
dated 11/9/2014 executed by defendant no.2 in favour of defendant no.4 is
null and void.
8. Being aggrieved by the judgment and decree passed by the Trial
Court, the respondents/defendants preferred an appeal and Sixth Additional
District Judge, Shivpuri, District Shivpuri by judgment and decree dated
9/7/2015 passed in RCA No.34/2015 partially allowed the appeal and set
aside the judgment and decree regarding specific performance of contract
and modified the judgment and decree passed by the Trial Court and directed
for refund of Rs.55,000/- to the plaintiff and it was directed that the plaintiff
shall also be entitled for 6% interest from the date of institution of the suit
till actual payment is made.
9. This Court by order dated 17/10/2025 has admitted the second
appeal on the following substantial questions of law:-
"(1) Whether, first appellate Court had erred in
law by refusing togrant decree for Specific Performance
of Contract ?
(2) Whether, Section 17 of Registration Act will
have over-ridingeffect on Section 49 of Registration
Act?"
10. Challenging judgment and decree passed by the Appellate Court, it
is submitted by learned counsel for the appellant that the Appellate Court has
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also held that the an agreement was executed by the defendants no.1 to 4, but
has set aside the discretionary decree of specific performance of contract
only on the ground that the same was not a registered document. It is
submitted that as per proviso to Section 49 of the Registration Act, in a case
for specific performance of contract, an unregistered agreement to sale is
admissible in evidence and relied upon the judgment passed by Hon'ble
Supreme Court in the case of R. Hemalatha Vs. Kashthuri reported in (2023)
10 SCC 725.
11. Per contra, it is submitted by learned counsel for the respondents
that although the defendants/respondents have not filed their cross-objection,
but in fact the plaintiff has failed to prove his readiness and willingness. The
Appellate Court has held that the agreement to sale was a document of
mortgage and, therefore, has directed for refund of money. It is further
submitted that although the sale deeds executed in favour of defendant no.4
were subsequently challenged by the plaintiff by incorporating amendment
in the plaint, but he did not pay the proper Court fee, therefore, the sale deeds
executed in favour of defendant no.4 cannot be declared as null and void.
12. Heard learned counsel for the parties and perused the record.
Whether the plaintiff has proved execution of agreement to sell, Ex.
P.1 and has also proved his readiness and willingness or not?
13. Although it is the case of the defendants that in order to prove
readiness and willingness the plaintiff must specifically plead and prove by
leading ocular and documentary evidence that he is in possession of the
consideration amount as well as the expenses for registration of the sale
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deed, however, it is the case of the defendants that the plaintiff has not filed
any documentary evidence to show that he was in possession of Rs.55,000/-.
14. Considered the submissions made by learned counsel for the
defendants.
15. Both the Courts below have given a concurrent finding of fact that
the document which was titled as agreement to sale, Ex. P.1 was executed. In
paragraph 17 of the judgement it was held by the First Appellate Court, that
the stamp papers were purchased by the defendants for execution of
agreement and in paragraph 18 it was held Mangilal Gupta (PW-5), who had
notarized the agreement to sale on 4/1/2012 has also stated that the document
was executed and it was read over to the deponents, who had accepted the
contents to be true. Hargyan (PW-1) has also admitted his signatures and
photographs on the agreement to sale (Ex.P/1), however, he tried to wriggle
out of the said document by saying that he has put his signatures in his house
as it was pretended by the plaintiff that they are getting KCC prepared. It was
held by the Appellate Court that since the property was mortgaged with the
bank and in the agreement to sell, Ex. P.1, the factum of mortgage was not
mentioned, therefore, it is clear that the intention of the plaintiff and
defendants was not to purchase and sell the property in dispute. However, in
paragraph 23 of the judgment it was held that execution of agreement to sale
(Ex.P/1) and notarization of the same and payment of Rs.55,000/- by way of
advance has been proved. In paragraph 26, it was held that since registration
of agreement to sale was necessary, therefore, it is not admissible in evidence
and thus, it was held that no decree for specific performance of contract can
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be granted and accordingly, it was held that the plaintiff is entitled for refund
of Rs.55,000/- with 6% interest.
16. The finding recorded by the Appellate Court that an unregistered
document can be considered only for collateral purpose is not correct under
the facts and circumstances of the case. In a case for specific performance of
contract, proviso to Section 49 of the Registration Act would apply and an
unregistered agreement to sale is admissible in law. The Supreme Court in
the case of R. Hemalatha (supra) has held as under:-
"23. Thus, as per the proviso to Section 49, an
unregistered document affecting the immovable
property and required by the Registration Act to be
registered may be received as evidence of a contract in
a suit for specific performance under Chapter II of the
Specific Relief Act, 1877, or as evidence of any
collateral transaction not required to be effected by
registered document.
24. At this stage, the primary Statement of Objects and
Reasons to the Tamil Nadu Amendment Act, 2012, is
also required to be referred to and considered. The
primary Statement of Objects and Reasons seems to
suggest that amendment has been introduced by the
State of Tamil Nadu bearing in mind the loss to the
exchequer as public were executing the documents
relating to sale of immovable property, etc. on white
paper or on stamp paper of nominal value.
25. At this stage, it is required to be noted that the
proviso to Section 49 came to be inserted vide Act 21
of 1929 and thereafter, Section 17(1-A) came to be
inserted by Act 48 of 2001 with effect from 24-9-2001
by which the documents containing contracts to transfer
for consideration any immovable property for the
purpose of Section 53-A of the Transfer of Property Act
is made compulsorily to be registered if they have been
executed on or after 2001 and if such documents are not
registered on or after such commencement, then they
shall have no effect for the purposes of said Section 53-
A. So, the exception to the proviso to Section 49 is
provided under Section 17(1-A) of the Registration Act.
Otherwise, the proviso to Section 49 with respect to the
documents other than referred to in Section 17(1-A)
shall be applicable.
26. Under the circumstances, as per the proviso to
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Section 49 of the Registration Act, an unregistered
document affecting immovable property and required
by the Registration Act or the Transfer of Property Act
to be registered, may be received as evidence of a
contract in a suit for specific performance under
Chapter II of the Specific Relief Act, 1877, or as
evidence of any collateral transaction not required to be
effected by registered instrument, however, subject to
Section 17(1-A) of the Registration Act. It is not the
case on behalf of either of the parties that the
document/agreement to sell in question would fall under
the category of document as per Section 17(1-A) of the
Registration Act. Therefore, in the facts and
circumstances of the case, the High Court has rightly
observed and held relying upon the proviso to Section
49 of the Registration Act that the unregistered
document in question, namely, unregistered agreement
to sell in question shall be admissible in evidence in a
suit for specific performance and the proviso is
exception to the first part of Section 49."
17. Thus, after having held that the agreement to sale (Ex.P/1) was
executed, which was duly notarized and an amount of Rs.55,000/- was also
received by the defendants by way of advance, then the Appellate Court
should not have interfered with the decree for specific performance of
contract passed by the Trial Court.
18. So far as the question of readiness and willingness is concerned, it
appears that the defendants did not raise this objection before the Appellate
Court. Even otherwise, the plaintiff in his examination in chief, had
specifically stated that he is ready and willing to perform his contract, but no
cross examination on the said aspect was done. Furthermore, the outstanding
amount was only Rs.55,000/- and it is not the case of the defendants that the
plaintiff is an indigent person.
19. So far as the submission made by counsel for the respondents that
since Court fee was not paid for the relief of declaration of subsequent sale
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deeds as null and void, therefore, said relief cannot be granted by the Trial
Court is concerned, the same cannot be accepted as it is misconceived.
20. The Supreme Court in the case of Maharaj Singh and others Vs.
Karan Singh (Dead) through Legal Representatives and others reported
i n (2024) 8 SCC 83 (decided on 9-7-2024 i n C.A. No. 6782 of 2013) has
held as under:-
"On Question 12.4(d)
20. Now, we deal with another argument that the
plaintiffs ought to have prayed in the suit to cancel the
subsequent sale deeds executed by the first defendant.
On this aspect, the law has been laid down by a Bench
of three Hon'ble Judges of this Court in Durga
Prasad v. Deep Chand [Durga Prasad v. Deep Chand ,
(1953) 2 SCC 509] , paras 40 to 42 of the said decision
read thus : (SCC p. 532)
"40. First, we reach the position that the title to the
property has validly passed from the vendor and resides
in the subsequent transferee. The sale to him is not void
but only voidable at the option of the earlier
"contractor". As the title no longer rests in the vendor it
would be illogical from a conveyancing point of view to
compel him to convey to the plaintiff unless steps are
taken to revest the title in him either by cancellation of
the subsequent sale or by reconveyance from the
subsequent purchaser to him. We do not know of any
case in which a reconveyance to the vendor was ordered
but Sulaiman, C.J. adopted the other course in Kali
Charan Singh v. Janak Deo Singh [Kali Charan
Singh v. Janak Deo Singh, 1932 SCC OnLine All 154] .
He directed cancellation of the subsequent sale and
conveyance to the plaintiff by the vendor in accordance
with the contract of sale of which the plaintiff sought
specific performance. But though this sounds logical the
objection to it is that it might bring in its train
complications between the vendor and the subsequent
purchaser. There may be covenants in the deed between
them which it would be inequitable to disturb by
cancellation of their deed. Accordingly, we do not think
that is a desirable solution.
41. We are not enamoured of the next alternative either,
namely, conveyance by the subsequent purchaser alone
to the plaintiff. It is true that would have the effect of
vesting the title to the property in the plaintiff but it
might be inequitable to compel the subsequent
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transferee to enter into terms and covenants in the
vendor's agreement with the plaintiff to which he would
never have agreed had he been a free agent; and if the
original contract is varied by altering or omitting such
terms the court will be remaking the contract, a thing it
has no power to do; and in any case it will no longer be
specifically enforcing the original contract but another
and different one.
42. In our opinion, the proper form of decree is to direct
specific performance of the contract between the vendor
and the plaintiff and direct the subsequent transferee to
join in the conveyance so as to pass on the title which
resides in him to the plaintiff. He does not join in any
special covenants made between the plaintiff and his
vendor; all he does is to pass on his title to the plaintiff.
This was the course followed by the Calcutta High
Court
inKafiladdin v. Samiraddin [Kafiladdin v. Samiraddin,
1930 SCC OnLine Cal 46] and appears to be the
English practice. See Fry on Specific Performance, 6th
Edn., p. 90, Para 207;
alsoPotter v. Sanders [Potter v. Sanders, (1846) 6 Hare
1 : 67 ER 1057] . We direct accordingly."
(emphasis supplied)
21. Reliance is placed by the appellants on the decision
of this Court in B. Vijaya Bharathi [B. Vijaya
Bharathi v. P. Savitri , (2018) 11 SCC 761 : (2018) 5
SCC (Civ) 239] . In para 17 of the said decision, this
Court held thus : (SCC pp. 767-68)
"17. It must also be noted that though aware of two
conveyances of the same property, the plaintiff did not
ask for their cancellation. This again, would stand in the
way of a decree of specific performance for unless the
sale made by Defendant 1 to Defendant 2, and
thereafter by Defendant 2 to Defendant 3 are set aside,
no decree for specific performance could possibly
follow. While Mr Rao may be right in stating that mere
delay without more would not disentitle his client to the
relief of specific performance, for the reasons stated
above, we find that this is not such a case. The High
Court was clearly right in finding that the bar of Section
16(c) was squarely attracted on the facts of the present
case, and that therefore, the fact that Defendants 2 and 3
may not be bona fide purchasers would not come in the
way of stating that such suit must be dismissed at the
threshold because of lack of readiness and willingness,
which is a basic condition for the grant of specific
performance."
(emphasis supplied)
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22. A Bench of two Hon'ble Judges has rendered this
decision. Unfortunately, the attention of the Bench was
not invited to binding precedent in the form of a
decision of a larger Bench in Durga Prasad [Durga
Prasad v. Deep Chand , (1953) 2 SCC 509] . Hence, the
decision in B. Vijaya Bharathi [B. Vijaya Bharathi v. P.
Savitri, (2018) 11 SCC 761 : (2018) 5 SCC (Civ) 239]
is not a binding precedent. Therefore, there was no
requirement to make a prayer in the plaint for
cancellation or setting aside the subsequent sale deeds.
23. Clauses (a) to (c) of Section 19 of the Specific
Relief Act read thus:
"19. Relief against parties and persons claiming under
them by subsequent title.--Except as otherwise
provided by this Chapter, specific performance of a
contract may be enforced against--
(a) either party thereto;
(b ) any other person claiming under him by a title
arising subsequently to the contract, except a transferee
for value who has paid his money in good faith and
without notice of the original contract;
(c) any person claiming under a title which, though prior
to the contract and known to the plaintiff, might have
been displaced by the defendant;"
(emphasis supplied)
24. In view of clause ( b ) of Section 19, the defendants
who are claiming under the sale deeds executed after the
execution of the suit agreement can be subjected to a
decree of specific performance as the suit agreement
can be enforced specifically against such defendants
unless they are bona fide purchasers without the notice
of the original contract. When, in a given case, the
defendants, who are subsequent purchasers, fail to
prove that they entered into the sale deed in good faith
and without notice of the suit agreement, in view of
Section 19(b ), a decree for specific performance can be
passed against such defendants. Therefore, in such a
case where Section 19(b ) is applicable, under the decree
of specific performance, the subsequent purchasers can
be directed to execute the sale deed along with the
original vendor. There is no necessity to pray for the
cancellation of the subsequent sale deeds."
21. Therefore, even assuming that no Court fee was paid, still it cannot
be said that it was obligatory on the part of the plaintiff to seek cancellation
of the sale deeds, which were executed subsequent to the agreement to sale.
22. Even otherwise, a plaint cannot be rejected at the threshold on
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the ground of non-payment of Court fee. If the Court comes to the
conclusion that proper Court fee has not been paid, then it has to give an
opportunity to the plaintiff to make good the deficit Court fee and only if the
plaintiff fails to pay the deficit Court fee, then the plaint is liable to be
rejected.
23. It is submitted by counsel for the appellant that the defendants
never raised an objection regarding deficit Court fee. It is submitted that
although the question of Court fee is in between the plaintiff and the State,
but even otherwise the plaintiff is ready to pay the deficit Court fee, which
according to the defendants is payable on the relief for cancellation of sale
deeds executed in favour of defendant no.4 and accordingly, prayed that the
appellant shall pay the deficit Court fee on the aforesaid relief within a
period of one month from today.
24. Considered the aforesaid submission.
25. As already held, there is no necessity to pray for cancellation of the
subsequent sale deeds, therefore, even if no Court fee was paid on the relief
of cancellation of sale deeds, still the suit for specific performance of
contract is maintainable and prayer of cancellation of subsequent sale deeds
is inbuilt. Further, in the present case, the appellant has given an undertaking
that he would pay the deficit Court fee within a period of one month from
today,
26. Section VII Rule 11 CPC requires that after adjudicating the fact
that the plaintiff has not paid the proper Court fee, an opportunity has to be
given to the plaintiff to make good the default and only on the failure on the
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part of the plaintiff, the plaint is liable to be rejected. Under these
circumstances, although it was not necessary for the plaintiff to pray for
cancellation of sale deeds, but it is directed that the appellant shall pay the
fixed deficit Court fee on the prayer which was subsequently amended for
cancellation of subsequent sale deeds in favour of defendant no.4 within a
period of one month from today.
27. So far as the contention of the counsel for the defendants that the
agreement to sale was a document of mortgage is concerned, the same cannot
be accepted. It is not the case of anybody that agreement to sale (Ex.P/1) was
a document of mortgage. Even otherwise, the Appellate Court has also not
held that the agreement to sale (Ex.P/1) was in fact a mortgage deed. The
Appellate Court has merely held that since the property was already
mortgaged with the bank, therefore, intention of the plaintiff and defendants
does not appear to purchase and sell the property. However, it is clear from
Khasra of 2013-14 Ex. P.3, the mortgage was redeemed in the year 2013. If
the property was under mortgage, then it was the duty of the defendants to
first get the property released from mortgage and then to execute sale deed in
favor of plaintiff. However, merely because the property was under
mortgage, it cannot be said that even the agreement to sell could not have
been executed.
28. No other arguments is advanced by the Counsel for the parties.
29. Accordingly, both the Substantial Questions of Law are answered
in affirmative.
30. Ex consequenti, the judgment and decree dated 9/5/2018 passed
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by Sixth Additional District Judge, Shivpuri, District Shivpuri in Civil
Appeal No.34/2015 is hereby set aside and the judgment and decree dated
9/7/2015 passed by Civil Judge, Class-II, Pohari, District Shivpuri in RCSA
No.8A/2014 is hereby restored.
31. The appeal succeeds and is hereby allowed .
32. Decree be drawn accordingly.
(G. S. AHLUWALIA)
JUDGE
Arun*
