An unregistered sale agreement can still be used to seek specific performance despite non-registration due to exceptions allowed under the law.

JUDGMENT :

P. Krishna Kumar, J.

1. These appeals arise from a suit instituted by the first respondent (hereinafter referred to as "the plaintiff") seeking specific performance of an agreement for the sale of immovable property. The trial court decreed the suit in favour of the plaintiff and dismissed the counterclaim raised by the appellant, who was the first defendant in the original suit (hereinafter referred to as "the defendant"). The defendant now challenges the said decree in these appeals.

2. As per the agreement dated 20.01.2014, the defendant agreed to sell 1.26 acres of land owned by him to the plaintiff at the rate of Rs.9,000/- per cent, within a period of three months. The plaintiff contended that an amount of Rs.11.37 lakhs was paid as advance sale consideration to the defendant’s Power of Attorney holder. Subsequently, the plaintiff paid the entire sale consideration through three cheques to the said Power of Attorney holder. Expecting that the defendant would execute the sale deed as agreed, the plaintiff purchased stamp paper worth Rs.1.8 lakhs on 19.04.2014. The plaintiff was compelled to institute the suit since the defendant failed to execute the sale deed.

3. According to the plaintiff, the agreement for sale was part of a broader compromise arrangement involving certain other parties, aimed at resolving long standing disputes between them with the defendant’s brother, a multimillionaire. The agreement was also signed by the Power of Attorney holder of the defendant, on behalf of the defendant. Pursuant to this compromise, the plaintiff and certain other individuals had already transferred their respective properties to the intended parties. The defendant, however, failed to act in accordance with the agreement, it is alleged.

4. The defendant denied being a party to the aforementioned compromise and challenged the validity and enforceability of the sale agreement, asserting that it was unregistered and, therefore, not legally binding. He further alleged that the actual agreed sale price was Rs.61,000/- per cent, but in the agreement, the plaintiff falsely recorded it as Rs.9,000/- per cent, contrary to the real understanding between the parties. The defendant also alleged that the plaintiff had trespassed upon the land in question prior to the expiry of the agreement period and had altered its physical features by levelling the terrain. On these grounds, he raised a counterclaim seeking recovery of possession.

5. Upon consideration of the oral and documentary evidence, the trial court found that the sale agreement (Ext.A2) had indeed been executed between the plaintiff and the defendant, and that the plaintiff had paid the entire consideration. Accordingly, the suit was decreed in favour of the plaintiff. Consequently, the counterclaim was dismissed.

6. We have heard Sri.T.R.S.Kumar, the learned counsel appearing for the defendant/appellant and Sri.T.M.Chandran, the learned counsel appearing for the plaintiff/first respondent.

7. The principal contention advanced by the learned counsel for the defendant is that the decree for specific performance ought not to have been granted by the trial court, as the agreement for sale was unregistered. According to him, pursuant to the amendment introduced by the State Legislature to Section 17 (1) of the Registration Act (hereinafter referred to as "the Act") all contracts for sale are mandatorily required to be registered, with effect from 13.09.2013. The learned counsel further contended that, although Section 49 of the Act permits an unregistered document t