Unregistered document, which does not affect ‘immovable property’, being record of past transaction,may not attract Sec. 49(1)(a) of Registration Act:Apex Court

Read Judgment: Korukonda Chalapathi Rao & Anr vs. Korukonda Annapurna Sampath Kumar

Pankaj Bajpai

New Delhi, October 4, 2021:The Supreme Court has observed that when there has been a partition, then, there may be no scope for invoking the concept of antecedent right as such, which is inapposite after a disruption in the joint family status and what is more an outright partition by metes and bounds. 

Since the document does not purport to by itself create, declare, assign, extinguish or limit right in properties, thus, the Khararunama may not attract Section 49(1)(a) of the Registration Act, added the Court. 

Noticing that the appellants and the respondents, admittedly, partitioned their joint family properties, which fact was clear from the Khararunama, the Division Bench of Justice K.M. Joseph and Justice S.Ravindra Bhat observed that u/s 49(1)(a) of the Registration Act, a compulsorily registrable document, which is not registered, cannot produce any effect on the rights in immovable property by way of creation, declaration, assignment, limiting or extinguishment. 

Section 49(1)(c) in effect, reinforces and safeguards against the dilution of the mandate of Section 49(1)(a). Thus, it prevents an unregistered document being used ‘as’ evidence of the transaction, which ‘affects’ immovable property. If the Khararunama by itself, does not ‘affect’ immovable property, being a record of the alleged past transaction, though relating to immovable property, there would be no breach of Section 49(1)(c), as it is not being used as evidence of a transaction effecting such property, added the Bench. 

The background of the case was that on November 17, 1980, a partition list was executed recording the fact of partition which was already effected. Accordingly, Korukonda Annapurna Sampath Kumar (respondent) and his wife raised a dispute before elders that the portion given to them wasn’t sufficient. 

Due to the elder’s intervention, the respondents & the appellants settled that the respondent would give his portion to the second appellant and his one-third portion in Nadava Margam to the appellants and in consideration, the first appellant (Korukonda Chalapathi Rao) and second appellant had to give Rs.25000 and Rs.75000 to the respondent. 

After the payment was done, a Kharurunama dated April 15, 1986, was executed. Later, in December 1993, the respondent and his wife informed the appellants that they would vacate the portion in the second appellant’s house and leave the same but demanded additional money.

Accordingly, the second appellant paid Rs.2,00,000 to the respondent, who then vacated the portion in his occupation in the house of the second appellant and shifted to a rented portion. 

However, later, the respondent instituted a suit seeking declaration of title over the plaint schedule properties listed in the partition deed and sought for eviction of Korukonda Chalapathi Rao. 

It was alleged by the respondent that while he was in hospital for treatment of his liver ailment, the appellants allegedly obtained his signatures on papers and made up the Khararunama. 

On the other hand, the appellants filed an evidence affidavit and sought to mark the Kharurnama and receipt of additional payments made to the respondent. 

The Trial court rejected the respondent’s objections to marking the documents and posted the matter for evidence. 

Later, the Telangana High Court found that the documents which were the unregistered family settlement “Khararunama” and receipt of Rs.2,00,000/- by the respondent, in the absence of registration and not being stamped the documents were inadmissible. Challenging the same, the appellants approached the Top Court.

The counsel for the appellants submitted that the High Court had erred in not considering the family settlement “Khararunama” and receipt in accordance with well-established principles relating to the law of family settlement. 

The counsel also contended that if the terms of the said family settlement was reduced into writing, and it was only a memorandum executed subsequently recording the terms of the oral family settlement, then, no registration was needed.

Opposing the same, the counsel for the respondents urged that the family settlement required registration u/s 17(1)(b) of the Registration Act, 1908. 

After considering the arguments, the Apex Court observed that the law is not that in every case where a party sets up the plea that the court may look into an unregistered document to show the nature of the possession that the court would agree to it. 

The cardinal principle would be whether by allowing the case of the party to consider an unregistered document it would result in the breach of the mandate of Section 49 of the Registration Act, added the Court. 

Observing that since the Khararunama by itself, does not ‘affect’ immovable property, being a record of the alleged past transaction, though relating to immovable property, the Top Court said that there would be no breach of Section 49(1)(c), as it was not being used as evidence of a transaction effecting such property. 

The Division Bench further observed that merely admitting the Khararunama containing the record of the alleged past transaction, is not to be, however, understood as meaning that if those past transactions require registration, then, the mere admission, in evidence of the Khararunama and the receipt would produce any legal effect on the immovable properties in question. 

The Bench also added that Khararunama, being record of the alleged transactions, may not require to be stamped.