2023 (11) TMI 1314 - SC - Indian Laws

Unregistered Agreement to Sell and Power of Attorney cannot transfer title to immovable property under Registration Act 1908

Shakeel Ahmed Versus Syed Akhlaq Hussain

SC allowed appeal and dismissed suit for possession and mesne profits. Court held that unregistered Agreement to Sell and General Power of Attorney cannot ... Dismissal of appeal and the judgment and decree of the Trial Court decreeing the suit for possession and mesne profits - HELD THAT:- It is to be emphasized that irrespective of what was decided in the case of Suraj Lamps and Industries [2011 (10) TMI 8 - SUPREME COURT] the fact remains that no title could be transferred with respect to immovable properties on the basis of an unregistered Agreement to Sell or on the basis of an unregistered General Power of Attorney. The Registration Act, 1908 clearly provides that a document which requires compulsory registration under the Act, would not confer any right, much less a legally enforceable right to approach a Court of Law on its basis. Even if these documents i.e. the Agreement to Sell and the Power of Attorney were registered, still it could not be said that the Respondent would have acquired title over the property in question. At best, on the basis of the registered agreement to sell, he could have claimed relief of specific performance in appropriate proceedings. In this regard, reference may be made to Sections 17 and 49 of the Registration Act and Section 54 of the Transfer of Property Act, 1882. Law is well settled that no right, title or interest in immovable property can be conferred without a registered document. The embargo put on registration of documents would not override the statutory provision so as to confer title on the basis of unregistered documents with respect to immovable property. Once this is the settled position, the Respondent could not have maintained the suit for possession and mesne profits against the Appellant, who was admittedly in possession of the property in question whether as an owner or a licensee. In case the Respondent wanted to evict the Appellant treating him to be a licensee, he could have maintained a suit on behalf of the true owner or the landlord under specific instructions of Power of Attorney as landlord claiming to have been receiving rent from the Appellant or as Attorney of the true owner to institute the suit on his behalf for eviction and possession. That being not the contents of the plaint, the reasoning given by the High Court in the impugned order cannot be agreed upon. The impugned judgment deserves to be set aside and the suit deserves to be dismissed. Accordingly, the appeal is allowed - The impugned judgment is set aside and the suit is dismissed. Issues:Appeal against judgment and order for possession and mesne profits.Analysis:The judgment in question pertains to an appeal against a High Court decision in a suit for possession and mesne profits between the Appellant and the Respondent. The suit was based on a Power of Attorney, agreement to sell, affidavit, and a will executed in favor of the Respondent. The Appellant contested the suit, claiming ownership through an oral gift (Hiba) from his brother and challenging the admissibility of the documents. The Trial Court decided in favor of the Respondent on most issues, granting possession and mesne profits. The High Court upheld the decision, rejecting the Appellant's claim of Hiba and allowing the suit based on the Respondent acting as an Attorney for the property owner. The Appellant argued against the reliance on unregistered documents and the Respondent's capacity to maintain the suit.The Appellant contended that the unregistered documents, including the agreement to sell, Power of Attorney, and will, did not confer ownership rights on the Respondent. The Appellant claimed to have proven the oral gift but was disregarded by the courts. The Appellant challenged the High Court's reasoning that the suit was maintainable through the Respondent as an Attorney for the property owner, asserting that the suit was filed in the Respondent's individual capacity. The Respondent argued that the customary documents provided full title and ownership rights, citing a prohibition on registration in the property's area and the prospective application of relevant judgments.The judgment emphasized that immovable property rights cannot be transferred without a registered document, citing relevant statutes. It referenced previous judgments to support this principle. The judgment rejected the argument that the embargo on registration could confer title based on unregistered documents. It also dismissed the prospective application of judgments, stating that the requirement for registration and its effects are statutory. The judgment concluded that the suit should be dismissed as the Respondent could not maintain it against the Appellant, who was in possession, whether as an owner or licensee.In summary, the Supreme Court allowed the appeal, setting aside the High Court's judgment and dismissing the suit. No costs were awarded, and pending applications were disposed of.