K. Raghunandan & Ors. Vs. Ali Hussain Sabir & Ors.  INSC 920
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO. 3572 OF 2008 [Arising out of SLP
(Civil) No. 6504 of 2006] K. Raghunandan & Ors. ...Appellants Versus Ali
Hussain Sabir & Ors. ...
S.B. SINHA, J :
1. Leave granted.
2. Application of Section
17(2)(vi) of the Registration Act, 1908 (for short "the Act") in the
facts and circumstances of this case is in question in this appeal which arises
out of a judgment and order dated 31.03.2001 passed by the High Court of Andhra
Pradesh at Hyderabad in L.P.A. Nos.
163 and 229 of 2000.
3. Appellants are neighbours. The
dispute between the parties relate to a passage. Plaintiffs - Appellants claimed
to have purchased 590 sq. yards of premises No. 5-4-413 to 415 at Nampally,
Hyderabad from one P.N.
Vijaya Lakshmi. Allegedly, another
259 sq. yards of land was also purchased by them from the said vendor. When
they had been proceeding with the construction of the building, allegedly,
A suit bearing No. OS No. 76 of
1975 was filed claiming for a decree for perpetual injunction. The said suit
ended in a compromise, the terms whereof are as under:
"That the portion marked
Green in the plan shall be exclusively enjoyed by the Defendant without any
interference from the plaintiffs. The plaintiffs hereby admit that this portion
of land marked Green in the plan attached with the Memo of compromise belongs
to the Defendant No. 1 and his brother Sri Noman Ali son of Sri Abdul Khader,
Defendant No. 2.
portion marked Red will be enjoyed by the plaintiffs exclusively without any
interference with the Defendants or his agents.
other claims against Defendant in the suit are hereby withdrawn by the
4. A map was annexed to the
consent terms. All the properties shown in the red were accepted to be the
properties of the plaintiffs and the 3 defendants had allegedly agreed not to
interfere with their possession. It was stated that a passage running from
north to south connecting Mukarramjahi Road was shown to be the exclusive
property of the plaintiffs. It was furthermore alleged that the respondents'
father was a tenant in the premises bearing No. 5-4-412. The said property was
purchased by the respondent No. 1 in a public auction held on 8.11.1957.
The extent of the land which was
the subject matter is in dispute.
5. Respondents admittedly had
constructed shops on Moajamjahi road with a huge opening on the main road. The
defendants despite the said consent terms made attempt to fix an old door on
the eastern side of their wall making an opening on the purported private
passage belonging to the appellants.
Respondents, however, contended
that the appellants have no exclusive right over the scheduled property, i.e.,
passage measuring 80 yards situated at Nampally, Hyderabad. According to them,
the passage in question was a common passage.
6. Appellants filed a suit which
was marked as O.S. No. 341 of 1993 for a declaration that the suit passage, as
shown in the red marked A, B, C and D in the plaint is their private property.
7. Respondents filed a suit for
perpetual injunction which was marked as O.S. No. 1132 of 1993, and renumbered
as O.S. No. 769 of 1994, seeking injunction against the appellants from
interfering with their usage of the passage. It was alleged that the appellants
tampered with the plan by adding the word "plaintiffs" above the word
"passage" in the plan.
8. The said suits were consolidated;
the claims of the parties having common issues. The issued framed were:
"In O.S. No. 341/93 1)
Whether the plaintiffs are entitled for the relief of declaration as prayed
for? 2) Whether the plaintiffs are entitled for perpetual injunction as prayed
for? 3) Whether the plaintiffs are entitled for mandatory injunction as prayed
for? 4) To what relief? In O.S. No. 769/1994 1) Whether the plaintiffs are
entitled for the relief of perpetual injunction as prayed for? 2) To what
5 The learned Senior Civil Judge,
City Civil Court, Hyderabad by a common judgment decreed O.S. No. 341 of 1993
and dismissed the suit filed by the respondents viz. O.S. No.769 of 1994.
9. Appeals were preferred
thereagainst by the respondents.
Whereas the learned Trial Judge
held that the compromise decree conferred a right on the appellants in respect
of the passage in question, the First Appellate Court opined that the suit
passage was not the subject matter of compromise and in any event the same did
not confer any exclusive right, title and interest thereto upon the appellants.
10. Two Letters Patent Appeals
were preferred thereagainst by the appellants, which have been dismissed by
reason of the impugned judgment inter alia on the premise that the compromise
decree being not registered, no claim relying on or on the basis thereof could
form the basis of the suit.
11. Mr. H.S. Gururaja Rao, learned
senior counsel appearing on behalf of the appellants, would submit that a
consent decree not only operates as estoppel by judgment, even the general
principles of res judicata would be applicable.
The High Court, it was submitted,
thus, committed a serious error in relying on the decision of this Court in
Bhoop Singh v. Ram Singh Major 6 and Others [(1995) 5 SCC 709] which has been
distinguished in Som Dev and Others v. Rati Ram and Another [(2006) 10 SCC 788]
and, thus, the impugned judgment cannot be sustained.
12. Mr. P.S. Narsimha, learned
counsel appearing on behalf of the respondents, on the other hand, submitted that
the First Appellate Court having arrived at a question of fact that the
plaintiffs - appellants did not derive any right, title and interest in the
passage by reason of the said compromise and/ or in any event the plaintiffs -
appellants having not claimed any right, title and interest thereupon in the
suit, the compromise decree required registration.
13. O.S. No. 76 of 1975 admittedly
was a suit for injunction. The plaint of the said suit is not before us. It,
however, appears from the judgment of the First Appellate Court that the
passage was not the subject matter of compromise in the said O.S. No. 76 of
1975. This fact is not disputed.
14. The First Appellate Court as
also the High Court analysed the materials brought on record.
The question which would arise for
our consideration is as to what would be the effect of admitted case of the
parties that the suit passage was not the subject matter thereof.
7 We have noticed hereinbefore
that the parties joined issues as to whether the word "plaintiffs"
was added before the word "passage" in the plan annexed to the
consent terms or not. We have also noticed hereinbefore that the portion marked
in red was allotted to the plaintiffs- appellants and that marked in green was
allotted to the defendants - respondents. Appellant No. 1, examined himself as
PW-1. He admitted that in the compromise memo there was no mention about the
suit passage. He also admitted that he had not claimed the suit passage in the
said suit. He also admitted that his vendor had provided the suit passage for
his use. A finding of fact has been arrived at that the passage was not shown
either in the areas demarcated in red or green.
15. With a view to determine the
issue as to whether the passage could have been the subject matter of compromise,
the parties adduced evidence.
The building plan submitted by the
appellants before the Municipality was brought on record. The passage was shown
as a road which means a public road. A finding of fact had been arrived at that
there was nothing on record to show that the passage was a private one. The
High Court, in our opinion, rightly came to the conclusion that the plan must
be read in terms of the memo filed and as the passage did not form part of the
building plan, prima facie, it was common to both. It has furthermore been
found that the 8 defendants had no other motorable road for approach to their
factory which is being run on premises No. 5-4-412.
16. Sub-section (1) of Section 17
of the Act specifies the documents of which registration is compulsory; clauses
(b), (c) and (e) whereof read as under:
"17 - Documents of which
registration is compulsory (1) The following documents shall be registered, if
the property to which they relate is situate in a district in which, and if
they have been executed on or after the date on which, Act No. XVI of 1864, or
the Indian Registration Act, 1866, or the Indian Registration Act, 1871, or the
Indian Registration Act, 1877, or this Act came or comes into force, namely:--
(a) *** (b) other non-testamentary instruments which purport or operate to
create, declare, assign, limit or extinguish, whether in present or in future,
any right, title or interest, whether vested or contingent, of the value of one
hundred rupees and upwards, to or in immovable property;
(c) non-testamentary instruments
which acknowledge the receipt or payment of any consideration on account of the
creation, declaration, assignment, limitation or extinction of any such right,
title or interest; and 9 (d) *** (e) non-testamentary instruments transferring
or assigning any decree or order of a Court or any award when such decree or
order or award purports or operates to create, declare, assign, limit or
extinguish, whether in present or in future, any right, title or interest,
whether vested or contingent, of the value of one hundred rupees and upwards,
to or in immovable property:
Provided that the State Government
may, by order published in the Official Gazette, exempt from the operation of
this sub-section any lease executed in any district, or part of a district, the
terms granted by which do not exceed five years and the annual rents reserved
by which do not exceed fifty rupees."
17. Sub-section (2) of Section 17
of the Act, however, carves out an exception therefrom stating that nothing in
clauses (b) and (c) of Sub- section (1) of Section 17 would inter alia apply to
"any decree or order of a Court except a decree or order expressed to be
made on a compromise and comprising immovable property other than that which is
the subject-matter of the suit or proceeding". Even if the passage was not
the subject matter of the suit, indisputably, in terms of the Code of Civil
Procedure Amendment Act, 1976, a compromise decree was permissible.
18. A plain reading of the said
provision clearly shows that a property which is not the subject matter of the
suit or a proceeding would come within the purview of exception contained in
clause (vi) of Sub-section (2) of Section 17 of the Act. If a compromise is
entered into in respect of an immovable property, comprising other than that
which was the subject matter of the suit or the proceeding, the same would
The said provision was inserted by
Act 21 of 1929.
19. The Code of Civil Procedure
Amendment Act, 1976 does not and cannot override the provisions of the Act. The
purported passage being not the subject matter of the suit, if sought to be
transferred by the defendants - respondents in favour of the plaintiffs -
appellants or if by reason thereof they have relinquished their own rights and
recognized the rights of the plaintiffs - appellants, registration thereof was
imperative. The First Appellate Court held so. The High Court also accepted the
20. Mr. Gururaja Rao is,
therefore, not correct in contending that the High Court has not gone into the
said question. The High Court clearly affirmed the findings of fact arrived at
by the learned First Appellate Court.
11 It had, however, gone into the
legal question as to whether insertion of the word "plaintiffs"
before the word "passage" was an act of interpolation on the part of
the appellants or not, stating:
"There is also some confusion
with regard to the plan itself. Whereas the plaintiffs claim that the plan
showed the passage as plaintiffs' passage the defendants claim and submitted a
certified copy showing that the passage was shown only as `passage' and the
word `plaintiffs' was an act of interpolation. Even without going into that
controversy and believing that the memo stated the passage as plaintiffs'
passage could it still be enforced by this Court would be a question. The case
of the plaintiffs is that they had given up claim to 150 yards of land which
was to the rear side of their property and in lieu of it the passage was
exclusively given to the plaintiffs. This assertion in itself would show that
even before the compromise the passage was being used by the defendants but
whether the right over the passage by the defendants was given up by them in
lieu of 150 yards of land cannot be gone into because the compromise could not
be enforced as it was not a registered compromise..."
21. Appellants have given up their
claim of 150 yards of land which was to be on the rear side of the property and
in lieu thereof the passage was exclusively given to the plaintiffs -
appellants. Thus, the appellants have rested its case on the basis of an
exchange of land between the plaintiffs and defendants. The High Court opined
that as by reason thereof an inference 12 can be drawn that the defendants who
had been in possession of the passage had given up their rights in lieu of 150
yards of land, the same would constitute a transfer of property and, thus,
necessitated registration. It was in the aforementioned situation the High
Court relied upon the decision of this Court in Bhoop Singh (supra).
22. Bhoop Singh (supra), inter
alia, lays down:
"(1) Compromise decree if
bona fide, in the sense that the compromise is not a device to obviate payment
of stamp duty and frustrate the law relating to registration, would not require
registration. In a converse situation, it would require registration.
(2) If the compromise decree were
to create for the first time right, title or interest in immovable property of
the value of Rs.100 or upwards in favour of any party to the suit the decree or
order would require registration."
23. Thus, indisputably, if the
consent terms create a right for the first time as contra-distinguished from
recognition of a right, registration thereof would be required, if the value of
the property is Rs.100/- and upwards.
Strong reliance has been placed by
Mr. Gururaja Rao on Tulsan v.
Pyare Lal and Others [(2006) 10
SCC 782], Som Dev (supra), Shankar Sitaram Sontakke and Another v. Balkrishna
Sitaram Sontakke and Others 13 [1955 (1) SCR 99], Raja Sri Sailendra Narayan
Bhanja Deo v. The State of Orissa [1956 SCR 73], Ramdas Sah and another v.
Jagarnath Prasad and others [AIR 1960 Patna 179] and M. Pappu Reddiar (died)
and others v.
Amaravathi Ammal and others [AIR
1971 Madras 182].
24. In view of the point involved
in this appeal, we need not go into the question as to whether a consent decree
would attract the principles of res judicata or estoppel by judgment. We will
assume (although there may be some doubt or dispute with regard to the said
proposition that the said principles are applicable. The question, as indicated
hereinbefore, however, is as to the effect thereof.
25. In Ramdas Sah (supra), a
Division Bench observed:
"2. The first point taken on
behalf of the appellants is that the compromise decree in Title Suit No. 2 of
1948 required registration, because plot No. 2240 was outside the scope of the
suit, and in the absence of registration the compromise decree was not
effective with regard to plot No.
2240. We do not think there is any
substance in this argument. It appears that the plaintiff in the partition suit
in the present case claimed exclusive title to plot No. 2240 but sought a
decree for partition with regard to other properties.
In the compromise decree there was
an agreement between the parties that plot No. 2240 be exclusively allotted to
the plaintiff and since the 14 title of the plaintiff to plot No. 2240 was
taken as part of the consideration for the compromise entered into between all
the parties and since it is an integral part of the compromise it is obvious
that title to plot No. 2240 was within the scope of the partition suit and the
decree is operative even with regard to plot No. 2240 in the absence of
registration. The point has been fully dealt with in a judgment of this Court
in Miscellaneous Appeal No. 237 of 1953, decided on the 27th July, 1955, and
also in two other decisions, Ramjanam Tewary v. Bindeshwari Bai, AIR 1951 Pat
299 and Jagdish Chandra Sinha and another v. Dr. Sir Kameshwar Singh Bahadur
AIR 1953 Pat 178.
The question whether a particular
term of a compromise relates to the subject-matter of the suit is obviously a
question to be answered on the frame of the particular suit, the relief claimed
in the suit and the matters arising for decision on the pleadings of the
parties. The term is comprehensive enough, and if the compromise relates to all
the matters which fall to be decided in the case, it cannot be said that any
part of the compromise is beyond the subject-matter of the suit."
It was clearly held that the
subject matter of the suit was the subject matter of compromise. Having held
so, it was opined:
"In other words where the
compromise is really an adjustment of the rights and differences in respect of
all matters in dispute between the parties and the compromise purports to be a
final settlement 15 and adjustment of these disputes on a fair and satisfactory
basis acceptable to all, it must be held to relate to the suit. Applying the
principle to the present case we hold that the title to plot No. 2240 was the
subject-matter of the compromise and adjustment between the parties and so it
falls within the scope of the suit and the compromise decree does transfer
title to plot No. 2240 even without it being registered."
26. The said decision was followed
by the Madras High Court in M.
Pappu Reddiar (supra). In the fact
situation obtaining therein, it was held that the subject matter of the
compromise was inseparable from the other provisions of the compromise decree
and constituted part of the consideration for the compromise holding that the
subject matter of the suit is not synonymous with subject matter of the plaint.
It was in the peculiar facts of the said case, the Court opined:
"...If the consent decree or
order in the suit or proceeding covered the property, although it was not in
the plaint or in dispute, such property constituting, as it does, an
inseparable part of the consideration for the compromise, may well, in our
view, be regarded as the subject-matter of the suit. This is because of the
decree passed on the basis of the compromise cannot stand without that
property. If by the amendment it was intended that if the property was not in
the plaint schedule, the consent decree should not be exempted from 16
registration, we are afraid the phraseology actually employed by Section
17(2)(vi) has failed to achieve the objective. We are aware that the extended
scope we have given to the expression "subject-matter of the suit"
may narrow down the scope of the exclusion from exemption from registration
under that provision..."
The said decisions, therefore,
cannot be said to have any application in the present case.
27. In Bhoop Singh (supra), this
Court referring to Gurdev Kaur v. Mehar Singh [AIR 1989 P&H 324] and Ranbir
Singh v. Shri Chand [1984 Pun LJ 562] as also a decision of the Bombay High
Court in Sumintabai Ramkrishna Jadhav v. Rakhmabai Ramkrishna Jadhav [AIR 1981
Bom 52] held:
"13. In other words, the
court must enquire whether a document has recorded unqualified and
unconditional words of present demise of right, title and interest in the
property and included the essential terms of the same; if the document,
including a compromise memo, extinguishes the rights of one and seeks to confer
right, title or interest in praesenti in favour of the other, relating to
immovable property of the value of Rs 100 and upwards, the document or record
or compromise memo shall be compulsorily registered."
17 It was further observed:
"16. We have to view the
reach of clause (vi), which is an exception to sub-section (1), bearing all the
aforesaid in mind. We would think that the exception engrafted is meant to
cover that decree or order of a court, including a decree or order expressed to
be made on a compromise, which declares the pre-existing right and does not by
itself create new right, title or interest in praesenti in immovable property
of the value of Rs 100 or upwards. Any other view would find the mischief of
avoidance of registration, which requires payment of stamp duty, embedded in
the decree or order.
17. It would, therefore, be the
duty of the court to examine in each case whether the parties have pre-
existing right to the immovable property, or whether under the order or decree
of the court one party having right, title or interest therein agreed or
suffered to extinguish the same and created right, title or interest in
praesenti in immovable property of the value of Rs 100 or upwards in favour of
other party for the first time, either by compromise or pretended consent. If
latter be the position, the document is compulsorily registrable."
28. The decision of this Court in
Som Dev (supra) did not lay down any law which runs contrary to or inconsistent
with the law laid down in Bhoop Singh (supra). Bhoop Singh (supra) was
distinguished on fact stating:
"18. Therefore, it was a case
of the right being created by the decree for the first time unlike in 18 the
present case. In para 13 of that judgment it is stated that the Court must
enquire whether a document has recorded unqualified and unconditional words of
present demise of right, title and interest in the property and if the document
extinguishes that right of one and seeks to confer it on the other, it requires
But with respect, it must be
pointed out that a decree or order of a court does not require registration if
it is not based on a compromise on the ground that clauses (b) and (c) of
Section 17 of the Registration Act are attracted. Even a decree on a compromise
does not require registration if it does not take in property that is not the
subject- matter of the suit. A decree or order of a court is normally binding
on those who are parties to it unless it is shown by resort to Section 44 of
the Evidence Act that the same is one without jurisdiction or is vitiated by
fraud or collusion or that it is avoidable on any ground known to law.
But otherwise that decree is
operative and going by the plain language of Section 17 of the Registration
Act, particularly, in the context of sub-clause (vi) of sub-section (2) in the
background of the legislative history, it cannot be said that a decree based on
admission requires registration. On the facts of that case, it is seen that
their Lordships proceeded on the basis that it was the decree on admission that
created the title for the first time. It is obvious that it was treated as a
case coming under Section 17(1)(a) of the Act, though the scope of Section
17(2)(vi) of the Act was discussed in detail. But on the facts of this case, as
we have indicated and as found by the courts, it is not a case of a decree
creating for the first time a right, title or interest in the present plaintiff
and his brother. The present is a case where they were putting forward in the
suit a right based on an earlier transaction of relinquishment or family
arrangement by which they had acquired 19 interest in the property scheduled to
Clearly, Section 17(1)(a) is not
(emphasis supplied) In Som Dev
(supra), the plaintiff claimed half share in the property.
The defence was that the right of
the plaintiff having been created under a compromise and the same having not
been registered the same could not be enforced as against the contesting
defendants or their assignor, the other co- owner. The High Court opined that
the suit was based on a family settlement which did not require registration
and, thus, would come within the purview of Section 17(2)(vi) of the Act. It
was on the basis of the said finding of fact, the law was laid down stating:
"...Of course, we are not
unmindful of the line of authorities that say that even if there is inclusion
of property that is not the subject-matter of the suit, if it constitutes the
consideration for the compromise, such a compromise decree would be considered
to be a compromise relating to the subject-matter of the suit and such a decree
would also not require registration in view of clause (vi) of Section 17(2) of
the Registration Act. Since we are not concerned with that aspect here, it is
not necessary to further deal with that question.
Suffice it to say that on a plain
reading of clause (vi) of Section 17(2) all decrees and orders of the court
including a compromise decree subject to the exception as regards properties
that are outside the subject-matter of the suit, do not require registration on
the ground that they are hit by Sections 17(1)(b) and (c) of the Act. But at
the same time, there is no exemption or exclusion, in 20 respect of clauses
(a), (d) and (e) of Section 17(1) so that if a decree brings about a gift of
immovable property, or lease of immovable property from year to year or for a
term exceeding one year or reserving an early rent or a transfer of a decree or
order of a court or any award creating, declaring, assigning, limiting or
extinguishing rights to and in immovable property, that requires to be
29. A statute must be construed
having regard to the purpose and object thereof. Sub-section (1) of Section 17
of the Act makes registration of the documents compulsory. Sub-section (2) of
Section 17 of the Act excludes only the applications of Clauses (b) and (c) and
not clause (e) of Sub-section (1) of Section 17. If a right is created by a
compromise decree or is extinguished, it must compulsorily be registered.
Clause (vi) is an exception to the exception. If the latter part of Clause (vi)
of Sub-section (2) of Section 17 of the Act applies, the first part thereof
shall not apply. As in this case not only there exists a dispute with regard to
the title of the parties over the passage and the passage, itself, having not
found the part of the compromise, we do not find any infirmity in the impugned
The appeal is accordingly
dismissed with costs. Counsel's fee assessed at Rs. 25,000/-.
[S.B. Sinha] ................................J.
[Lokeshwar Singh Panta] New Delhi;
Pages: 1 2 3