Registered sale deed cannot be cancelled for cheque dishonour where later agreement seeks automatic cancellation.

A registered sale deed conveying immovable property cannot be cancelled merely because a later agreement provides for automatic cancellation on dishonour of a cheque for part of the consideration. Section 54 of the Transfer of Property Act treats a sale as a transfer of ownership for a price paid, promised, or partly paid and partly promised, and the registered conveyance remains effective unless set aside on recognised legal grounds. Non-payment or alleged non-receipt of the full consideration does not, by itself, justify cancellation of the registered instrument; the proper remedy lies elsewhere. The subsequent agreement clause could not override the registered sale deed.

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Issues: Whether a registered sale deed could be cancelled on the basis of a subsequent agreement clause stipulating automatic cancellation on dishonour of a cheque for part of the sale consideration.

Analysis: Section 54 of the Transfer of Property Act, 1882 recognises a sale as a transfer of ownership for a price paid, promised, or partly paid and partly promised, and requires transfer of tangible immovable property of the requisite value through a registered instrument. On the facts, the registered sale deed recorded transfer of the property for consideration, while the relied-upon agreement sought to override the registered document by making cancellation automatic upon dishonour of a cheque. The Court followed the principle that non-payment or alleged non-receipt of the entire consideration, by itself, does not furnish a ground to cancel a registered sale deed; the proper remedy lies elsewhere. The agreement clause could not be given overriding effect over the registered conveyance.

Conclusion: The challenge to cancellation of the registered sale deed failed, and the appeal was dismissed.

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