A consent decree operating as an instrument of gift of immovable property is compulsorily registrable under the Registration Act, and in the absence of registration, no valid title can pass thereunder.

S.P.Goyal, J.

1. The sole question involved in this second appeal against the judgment and decree of the learned Additional District Judge, Karnal, dated February 8, 1980 is, as to whether the consent decree which has the effect of transferring the land in dispute, measuring 38 Kanals 7 Marlas without any registered deed, would confer a valid title ?

2. Respondent Shri Chand filed this suit for a declaration that he is the owner-in-possession and in the alternative, for a decree of possession of the said land and for setting aside the decree passed in suit No. 187 of 1976 decided by the Court of Sub Judge 1st Class, Panipat, on March 30, 1976, on the basis of fraud and misrepresentation. The trial Court upheld the plea of misrepresentation and also held that no valid title could pass under the decree, the same having been not registered. Consequently, the previous decree was set aside and a decree for possession was passed in favour of the plaintiff. On appeal, the learned Additional District Judge, Karnal, reversed the finding of the trial Court on the question of misrepresentation but upheld the decree on the other ground vide judgment dated February 8, 1980. Still dissatisfied the defendant has come up in this second appeal.

3. Mr. C.D. Dewan, the learned counsel for the appellant, sought to challenge the correctness of the view taken by the Courts below, in the first instance, on the ground that a consent decree operates as res judicata and is binding on the parties unless it is successfully challenged on the ground of fraud or misrepresentation. He also raised another contention which essentially depends upon the first plea that the objection of the absence of registered document to effect a valid transfer, having been not raised in the earlier suit could not be raised in the present suit and was barred by the principle of constructive res judicata. Reliance for this contention was placed by the learned counsel on Sailendra Narayan Dhanja Deo v. The State of Orissa, A.I.R. 1956 SC 346; Shankar Sitaram Sontakke and another v. Balkrishana Sita Ram Sontakke and others, A.I.R. 1954 SC 352; State of U.P. v. Nawab Hussain, (1977) 2 Supreme Court Cases 806, Mansa Ram and others v. Nathu and others, I.L.R. 1955 Punjab 891; Gangaprashad and others v. Mt. Banaspati, A.I.R. 1937 Nagpur 132, and Laxmi Narain Gododia v. Mohd. Shafi Bari and others, A.I.R. 1949 East Punjab 141. Neither of the two contentions has any merit. In none of the authorities relied upon by the learned counsel it was ruled that the consent decree operates by way of res-judicata and all that was held is that it is as effective an estoppel between the parties as a judgment rendered by the Court in a contested matter.

4. It is well established that a decree passed on compromise remains essentially a contract between the parties with seal of the Court super- imposed thereon and is open to challenge on all grounds on which a contract can be vitiated. Consequently the consent decree can be challenged not only on the grounds available under the Contract Act such as fraud, mistake or misrepresentation but also on any of the grounds available under any other law which prohibits such a contract or declares it to be ineffective so far as the transfer of any rights in immoveable property are concerned. The plea of res judicata including the one of constructive res judicata, therefore, has no relevancy or bearing on the question of the efficacy of the decree in dispute.

5. It was next contended by the learned counsel that a decree based a compromise even though it has the effect of transferring the land in dispute, is covered by clause (vi), sub-section (2) of section 17 of the Registration Act and, therefore, does not require registration. This argument, again, has no basis and is wholly misconceived because sub-section (2) exempts any decree or order of a Court from the operation of clauses (b) and (c) only of sub- section (1) of section 17 which necessarily means