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IN THE HIGH COURT OF DELHI
Prathiba M. Singh, J.
Gagninder Kumar Gandhi - Appellant
Versus
Vijay Gupta - Respondent
C.R.P. 64 of 2020 and CM Appls. 24680 of 2020, 24681 of 2020
Decided On : 01-10-2020
The validity and enforceability of an unregistered undertaking in relation to immovable property is determined under the proviso to Section 49 of the Registration Act, 1908.
Headnote:(A) Registration Act, 1908 - Proviso to Section 49 - Enforceability of documents - The Petitioners contended that the undertaking was not genuine and lacked legal sanctity due to non-registration, while the Respondent argued its admissibility as evidence of a collateral transaction - The key issue considered was whether an unregistered undertaking could be enforceable. (Paras 4, 6, 7)
(B) Preliminary issues - The court noted that the enforceability of the undertaking could be framed as a preliminary issue for the trial court to decide - Directions were issued for timely adjudication. (Paras 7, 8)
Facts of the case:
The controversy arose from an undertaking pertaining to parking rights in a property, executed alongside sale deeds; the trial court had rejected the Petitioners' application challenging the undertaking's validity.
Findings of Court:
The court held that the issue of enforceability could be determined as a preliminary matter, urging the trial court to frame relevant issues and adjudicate expeditiously without prejudicing final outcomes.
Issues: The main issues were whether the unregistered undertaking could be enforced and its genuineness.
Ratio Decidendi: The court emphasized that the validity of the undertaking must be determined within the parameters established by the Registration Act and allowed for a preliminary assessment.
Result: The petition and all pending applications are disposed of.
| Table of Content |
|---|
| 1. factual basis of the property dispute (Para 2 , 3 , 4) |
| 2. arguments regarding the enforceability of the undertaking (Para 5 , 6) |
| 3. court's direction on preliminary issue decision (Para 7 , 8) |
| 4. disposal of the petition and applications (Para 9) |
JUDGMENT
Prathiba M. Singh, J. (Oral)--This hearing has been held through video conferencing.
2. The present revision petition has been preferred against the impugned order dated 20th May, 2020 by which the application under Order VII Rule 11 CPC filed by Defendant Nos.1&2/Petitioners (hereinafter, "Petitioners") has been rejected by the ld. Trial Court.
3. The brief background is that vide sale deed dated 11th July, 2001 and 7th August, 2003, the Plaintiff/Respondent No. 1 (hereinafter, "Respondent No.1") acquired rights in the first and second floor, with open terrace, of property bearing No. A-148, Defence Colony, New Delhi-110024. Along with the sale deeds, an undertaking of the same date i.e., 11th July, 2001 was also allegedly executed by the mother of Defendant No.3/Respondent No.2 (hereinafter, "Respondent No.2").
4. Respondent No.1 filed a suit for declaration, perpetual and mandatory injunction to enforce one clause of the alleged undertaking, which according to him, gives him parking rights in the rear portion of the property. The Petitioners filed an application under Order VII Rule 11 CPC in this suit, primarily on the ground that the alleged undertaking is not genuine and does not have any sanctity in law as the same is not a registered document.
5. Ld. counsel for the Petitioners argues that if documents create rights in immovable property the same require registration. It is further argued that there was also a settlement which was entered into between the parties which was recorded in an earlier suit, being CS (OS) 940/2010 on 6th September, 2013, in which no mention is made of the parking space. Thus, it is argued that the undertaking is not genuine and that the suit is not maintainable.
6. On the other hand, ld. counsel appearing for Respondent No.1 submits that the proviso to Section 49 of the REGISTRATION ACT , 1908 is clear that if there is any document which is evidence of a collateral transaction, it need not be registered.
7. The issue involved in this case is very short - whether the undertaking can be enforced without the same being registered and whether the undertaking is genuine or not. Considering the fact that the entire suit is based on the undertaking and the question as to whether under the proviso to Section 49 registration is required or not, is an issue which can be decided as a preliminary issue by the ld. Trial Court. Accordingly, the following directions are issued:
i. The ld. Trial Court shall frame an issue as to the enforceability and illegality of the undertaking dated 11th July, 2001;
ii. The said issue can be decided as a preliminary issue;
iii. The ld. Trial Court can hear the parties on the question as to whether any evidence would be required on the said preliminary issue or not and proceed in accordance with law.
8. Considering that the issue involved is quite short, the ld. Trial Court shall adjudicate this matter on this issue within a period of four months. If there is any report of the Economic offences Wing, in respect of this undertaking, the same shall be considered by the ld. Trial Court. The observations made in the impugned order shall not bind the final adjudication of this issue.
9. With these observations, the petition and all pending applications are disposed of.
