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1989 Supreme(J&K) 7
IN THE HIGH COURT OF JAMMU AND KASHMIR AT JAMMU
R.P. Sethi, J.
Gh. Mohd. - Appellant
Versus
Subhan - Respondent
CSA No. 59/1981
Decided On : 11 February, 1989
Advocate For Appellant: J.S. Kotwal
Advocate For Respondent: M.A. Goni
An agreement to sell, which acknowledges the receipt or payment of consideration, is not a non-testamentary instrument and does not require compulsory registration under Section 17(1)(c) of the Registration Act. The doctrine of equitable estoppel may be applied to bar a plaintiff from claiming back possession of land after receiving the full consideration amount and allowing the defendant to take possession and make improvements on the land.
Headnote:
REGISTRATION ACT - SECTION 17(1)(C) - AGREEMENT TO SELL - COMPULSORY REGISTRATION - NON-TESTAMENTARY INSTRUMENT - ACKNOWLEDGMENT OF RECEIPT OR PAYMENT OF CONSIDERATION - INTERPRETATION - APPLICABILITY - EQUITABLE ESTOPPEL - DOCTRINE - APPLICATION.
Fact of the Case:
Plaintiff filed a suit for possession of land, alleging permissive possession by the defendants based on an agreement to sell. The defendants relied on the agreement to sell and argued that the suit was not maintainable due to equitable estoppel. The trial court decreed the suit, but the first appellate court set aside the decree, holding that the suit was not maintainable due to equitable estoppel.
Finding of the Court:
The High Court held that the agreement to sell did not require compulsory registration under Section 17(1)(c) of the Registration Act, as it was not a non-testamentary instrument acknowledging the receipt or payment of consideration for the creation, declaration, assignment, limitation, or extinction of any right, title, or interest in immovable property. The court also held that the doctrine of equitable estoppel applied in the case, as the plaintiff had received the entire consideration amount and allowed the defendant to take possession and make improvements on the land.
Issues: 1. Whether the agreement to sell required compulsory registration under Section 17(1)(c) of the Registration Act. 2. Whether the doctrine of equitable estoppel applied in the case.
Ratio Decidendi: 1. The court interpreted Section 17(1)(c) of the Registration Act and held that an agreement to sell, which acknowledges the receipt or payment of consideration, is not a non-testamentary instrument and does not require compulsory registration. 2. The court applied the doctrine of equitable estoppel, holding that the plaintiff was estopped from claiming back possession of the land after receiving the full consideration amount and allowing the defendant to take possession and make improvements on the land.
Final Decision: The High Court dismissed the appeal, holding that the first appellate court was justified in setting aside the judgment and decree of the trial court and dismissing the suit of the plaintiff.
Section 17(l)(c) of the Registration Act reads :
"The following documents shall be registered namely :
a) ..............................
b) ..............................
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."
2. To attract the applicability of the aforesaid provision it has to be shown that the documents in dispute is a non-testamentary instrument acknowledging the receipt of a consideration on account of the creation, declaration, assignment, limitation extinction of any such title or interest. Non-testamentary instrument have not been defined under the Registration Act. An instrument is a writing as the means of giving formal expression to some Act, as a mean of creating, securing, modifying or terminating a right or affording evidence. A document which is operative immediately and is final and irrevocable is a non-testamentary instrument. The word "document" used in Section. 17 are inter-changeable and would not include an order of the court or any proceedings held in a Court. The word "Instrument" has been defined in Byres Law Dictionary (1923 Edition) as under:
"As instrument is a writing and generally means a writing of a formal nature, but where there is a power to appoint by "any deed or instrument or by will" any writing, such as a letter, which refers to the power, or which can have the effect only by operating on the fund (such as a cheque or other order for payment) is an instruments. A telegram is an instrument within the meaning of Forgery Act, 1913, Section. 7 (replacing the Forgery Act, 1961 Section 38 and so also in an envelope with a past mark falsified for purposes of abetting fraud, the term is in fact very comprehensive
3. Section 54 of the Transfer of property Act defines the contract for sale to mean, "a contract for the sale of immoveable property is a contract that a sale of such property shall take place on terms settled between the parties, but no such contract shall be valid, unless it is in writing, and signed by the parties. It does not, of itself create any interest in or change on such property. "The words, "declare, limit, create and extinguish" were interpreted by this court in case titled Ghulm Ahmad Vs. Gh. Qadir and Ors, reported in 1968: KLJ: 33, by holding:
"Now what is to be understood by the words, creating declaring, limiting and extinguishing of rights. The words create legal terminology means to bring into being, to invest with a new title, or to produce. Therefore every non-tesumentary instrument which means to, or has the effect of originating some right, title, or interest in immoveable property will be governed by the word create.
The word declare has been defined by west J. in 5 Bomb. 232 as under: "The word declare implies a declaration of will not merely a statement of fact and that a deed of partition which causes a change of legal relations to the property divided amongst all the parties to it is a declaration in the intended sense......"In AIR 1932 P. C. 55, their Lordships of the privy Council said that "though the word declare might be given a wider meaning they are
