1. Right of pre-emption under Mohammedan law — Dispute over whether the preliminary demand was made after the completion of a registered sale of immovable property. (Para 1 , 2 , 3 )
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1961 Supreme(SC) 220
SUPREME COURT OF INDIA
27th April, 1961
B.P. SINHA, C.J.I., A.K. SARKAR, K.C. DAS GUPTA, N. RAJAGOPALA AYYANGAR AND J.R. MUDHOLKAR, JJ.
Ram Saran Lall and others, Appellants
Versus
Mst. Domini Kuer and others, respondents.
Civil Appeal No. 104 of 1959.
Advocates Appeared
Mr. M. C. Setalvad, Attorney General for India (Mr. R. C. Prasad, Advocate with him), for Appellants; Mr. S. P. Varma, Advocate, for Respondent No. 1; Mr. N. S. Bindra, Senior Advocate (Mr. D. Gupta, Advocate, with him), for Intervener.
Advocates:
D.GUTPA, M.C.SETALVAD, N.S.BINDRA, R.C.Prasad, S.P.Varma
D.GUTPA, M.C.SETALVAD, N.S.BINDRA, R.C.Prasad, S.P.Varma
A sale requiring registration is complete only upon the completion of registration under the Registration Act. Section 47 of the Registration Act, which allows a document to operate retrospectively, does not advance the date of completion of the sale for the purpose of exercising pre-emption rights.
Headnote:(A) Transfer of Property Act, 1882 - Section 54; Registration Act, 1908 - Sections 3, 47, 61 - Right of pre-emption - Completion of sale - The right of pre-emption arises only out of a valid, complete, and bona fide sale; a requisite for exercising this right is that the preliminary demand (talab-i-mowasibat) must be made after the completion of the sale (Para 5).
(B) Registration Act, 1908 - Section 47 - A registered document operates from the time it would have commenced to operate if no registration were required, but this retrospective operation does not mean the sale is "complete" before the registration process is finished under Section 61 (Para 8).
(C) Transfer of Property Act, 1882 - Section 54 - Sale of tangible immovable property of a specified value can be made only by a registered instrument; such a sale is complete only when the instrument of sale is copied in the books of the Registration Office as provided in Section 61 of the Registration Act (Para 6).
Facts of the case:
A sale deed for a residential house was executed and presented for registration on the same day. The appellants, claiming a right of pre-emption, made a preliminary demand shortly after the execution of the deed. The balance of the purchase price was paid by the purchaser several days later, and the registration process was completed when the document was copied into the records of the registration office. The appellants' suit for pre-emption was subsequently challenged on the grounds that the preliminary demand was made before the sale was legally complete.
Findings of Court:
The court found that the sale became complete only on the date the registration was completed under Section 61 of the Registration Act. Because the preliminary demand was made prior to the completion of the registration, it was premature and insufficient to enforce the right of pre-emption.
Issues: Whether a sale requiring registration is completed on the date of execution (by applying Section 47 of the Registration Act) or on the date the registration process is completed under Section 61 of the Registration Act.
Ratio Decidendi: Section 47 of the Registration Act determines the date from which a document operates after it has been registered; it does not determine when a sale is completed. A sale that requires registration is not complete until the registration process is finished. A transaction that has retrospective operation upon completion cannot be said to have been completed on the date from which that operation begins.
Result: Appeal dismissed.
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Table of Contents
2. Whether a sale is completed upon registration under Section 61 of the Registration Act or operates retrospectively from the date of execution under Section 47. (Para 6 , 7 )
3. Analysis of the interplay between Section 47 and Section 61 of the Registration Act and the effect of the Transfer of Property Act on sale completion. (Para 8 , 15 , 16 )
4. A sale requiring registration is complete only upon registration; Section 47 of the Registration Act determines the operative date but not the date of completion. (Para 8 )
6. When is a sale of immovable property requiring registration considered complete for the purpose of exercising a right of pre-emption?
A sale is complete only when the registration process is finished, specifically when the document is copied into the records of the Registration Office as provided in Section 61 of the Registration Act. (Para 6 , 8 )
7. Does Section 47 of the Registration Act determine the date a sale is completed?
No. Section 47 allows a registered document to operate from a date earlier than its registration, but it does not determine when the registration process itself—and thus the sale—is completed. (Para 8 )
8. Do statutory provisions of the Transfer of Property Act supersede Mohammedan law regarding the completion of a sale?
Yes, the provisions of the Transfer of Property Act supersede the principles of Mohammedan law in determining whether and when a sale is complete for the purpose of giving rise to a right of pre-emption. (Para 15 )
Judgment
SARKAR, J. :The parties to this litigation are all Hindus but it is not in dispute that the Mohammedan law of pre-emption is applicable to them by custom, nor that the appellants had a right of pre-emption. The only question is whether the first demand called talab-i-mowasibat which has to be made after the completion of the sale in order that the right may be enforced, was made before or after such completion. The making of the demand is not in dispute but the dispute is as to when the sale was completed.
2. The appellants had their residential house contiguous to the house owned by certain persons whom we may call Pandeys. On January 31, 1946, the Pandeys executed a deed of sale in favour of the respondent purchaser in respect of their aforesaid house. The appellants claim a right of pre-emption on account of this sale. The consideration mentioned in the deed was Rs. 2,000/-. There was a subsisting mortgage on that house and the deed provided that out of the consideration a sum of Rs. 200/- would be left with the respondent purchaser for clearing off that mortgage. The deed also recited that the Pandeys had received Rs. 400/- and
"the remaining Rs. 1,400/- (Rupees fourteen hundred) in cash at the time of exchange of equivalents, (that is) at the time (of handing over) of the receipt of this deed .......... On receipt of the whole and entire amount of consideration money we have put the said claimant into possession and occupation of this vended property as absolute owner in place of us, the executants and our heirs and representatives." The deed further stated.
"the sale deed becomes operative from the date when we the executants affixed our signatures thereon. Whatever title, we the executants and our heirs had ............. with respect to this vended property, has become extinct, inoperative and null and void and the same has now been transferred to and acquired by the claimant."
By the word "claimant", the respondent purchaser was referred to.
3. The deed was presented at the registration office for registration by the Pandeys on the day it was executed and it was left with the Registrar in the Registration office for the necessary entries and copies being made, a receipt being given to the Pandeys. On February 2, 1946, the appellants on coming to hear of the execution of the deed of sale made the talab-i-mowasibat. On February 7, 1946, the receipt granted by the Registration Office to the Pandeys was made over by them to the respondent purchaser who thereupon paid the balance of the price as stipulated in the deed. On February 9, 1946, the documents were copied in the Registrar s books and thereupon the registration became complete as provided in S. 61 of the Registration Act. the respondent purchaser thereafter received the deed of sale from the Registrar s Office on February 13, 1946.
4. The appellants filed their suit for pre-emption of September 9, 1946. The suit was decreed by the trial Court and this decision was maintained by the first Appellate Court. The High Court, however, in second appeal set aside the decisions of the Courts below with the result that the suit stood dismissed and the appellants have now come to this Court in further appeal.
5. The Mohammedan law of pre-emption is stated in Mulla s Principles of Mohammedan law in these terms: "The right of pre-emption arises only out of a valid, complete and bona fide sale." This statement of the law is accepted by both the parties and there is no question that it is not correct. There is furthermore no dispute that the sale to the respondent purchaser was valid and bona fide. It is also agreed that one of the requisites before the right of pre-emption can be exercised is the preliminary demand by the pre-emptor and that such demand must be made after the completion of the sale. The case has been argued before us on behalf of the appellants on the basis that the sale was governed by the Transfer of Property Act. 1882. We will also proceed on that basis.
