Unregistered agreement to sell can support specific performance evidence, but not Section 53A protection; registered power of attorney stands

An unregistered agreement to sell may be received in evidence in a suit for specific performance under the proviso to Section 49 of the Registration Act, 1908, but it cannot confer protection under Section 53A of the Transfer of Property Act, 1882. The document's admissibility for that limited purpose does not decide its genuineness, validity, or substantive effect, which must be tested on evidence at the proper stage. A registered general power of attorney cannot be rejected at the threshold as insufficiently stamped or recharacterised as a conveyance merely by reference to an earlier agreement. The trial court's approach of marking the documents subject to proof and relevancy was restored.

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Issues: (i) Whether the agreement to sell dated 9 July 2003, though unregistered, could be received as evidence in a suit for specific performance and whether it could operate for the purpose of protection under Section 53A of the Transfer of Property Act, 1882; (ii) Whether the registered General Power of Attorney dated 2 May 1996 could be rejected as inadmissible on the ground of insufficient stamp duty by treating it as a conveyance.

Issue (i): Whether the agreement to sell dated 9 July 2003, though unregistered, could be received as evidence in a suit for specific performance and whether it could operate for the purpose of protection under Section 53A of the Transfer of Property Act, 1882.

Analysis: Section 17(1A) of the Registration Act, 1908 applies prospectively to documents executed on or after the commencement of the Amendment Act, 2001. An unregistered contract to transfer immovable property for consideration, if relied upon for the purpose of Section 53A of the Transfer of Property Act, 1882, has no effect for that purpose. However, under the proviso to Section 49 of the Registration Act, 1908, such a document may still be received as evidence of a contract in a suit for specific performance. The evidentiary reception of the document does not conclude questions of genuineness, validity, binding effect, or the applicability of the Stamp Act or the Transfer of Property Act, which must be decided at the proper stage on the evidence led by the parties.

Conclusion: The unregistered agreement to sell dated 9 July 2003 was admissible for the limited purpose of a suit for specific performance, but it could not be used for relief under Section 53A of the Transfer of Property Act, 1882.

Issue (ii): Whether the registered General Power of Attorney dated 2 May 1996 could be rejected as inadmissible on the ground of insufficient stamp duty by treating it as a conveyance.

Analysis: A registered instrument carries a rebuttable presumption of due stamping, and the question whether it is ultimately hit by the Stamp Act or any other statutory bar is to be examined on evidence at the appropriate stage. The instrument could not be recharacterised against the appellant by importing the terms of an earlier agreement to which the appellant was not a party. The High Court, therefore, erred in treating the power of attorney as a conveyance and in rejecting it outright at the evidentiary stage.

Conclusion: The registered General Power of Attorney could not be held inadmissible on the ground of insufficient stamp duty at that stage.

Final Conclusion: The order of the Trial Court permitting the documents to be marked subject to proof and relevancy was restored, and the questions of legality, genuineness, stamping, and substantive effect of the documents were left open for decision in accordance with law at the proper stage.

Ratio Decidendi: An unregistered agreement to transfer immovable property may be received in evidence in a suit for specific performance under the proviso to Section 49 of the Registration Act, 1908, but it cannot confer the protection of Section 53A of the Transfer of Property Act, 1882; a registered instrument cannot be rejected as inadmissible for insufficient stamp duty at the threshold when the question requires adjudication on evidence.

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