1. Writ Petition challenging registration of unilateral revocation of a settlement deed on grounds of absence of power. (Para 1 , 2 , 3 )
Back
Next 
2022 Supreme(Online)(MAD) 17790
HIGH COURT OF MADRAS
Anand Venkatesh, J
Sunitha Gridharidas – Appellant
Versus
Sub Registrar Purasaiwalkam – Respondent
W.P.No.10657 of 2015
Advocates:
For the Appellants/Petitioners: Sunnysheen for M/s. V. Raghavachari
For the Respondents: U. Baranidharan, C. Manishankar for M/s. C. S. Kiran
For the Appellants/Petitioners: Sunnysheen for M/s. V. Raghavachari
For the Respondents: U. Baranidharan, C. Manishankar for M/s. C. S. Kiran
A settlement deed reserving life interest for the settlor creates a vested interest in the settlee, not a contingent one. Such a deed cannot be unilaterally cancelled; any claims of coercion or fraud must be adjudicated by a competent Civil Court.
Headnote:(A) Constitution of India - Art. 226 - Transfer of Property Act, 1882 - S. 19 and S. 21 - Indian Succession Act, 1925 - S. 119 - Unilateral cancellation of settlement deed - Vested interest vs Contingent interest - Settlement deed executed in favour of daughters and granddaughter with life interest reserved for the settlor - Unilateral revocation deed subsequently registered - Whether retention of life interest and postponement of enjoyment constitutes a contingent interest allowing unilateral cancellation - It is a settled law that a person gets a vested interest when a proprietary right is acquired and only the right of enjoyment is deferred to a future date (Paras 18, 19) - Postponement of the right to transfer property does not take away the vested interest of the settlee (Para 18) - Where no condition precedent is imposed on the settlee, the interest is vested and not contingent (Paras 12, 21) - Unilateral cancellation of a settlement deed creating a vested interest is non-est in law and cannot be entertained by the Sub-Registrar, unless the settlee joins in the revocation (Paras 21, 23).
Facts of the case:
An absolute settlement deed dated 01.10.2009 was executed by the settlor in favour of her daughters and granddaughter, while reserving a life interest for herself and denying the settlees the right to alienate the property during her lifetime. Subsequently, the settlor executed a unilateral revocation deed dated 31.12.2013, alleging coercion and undue influence, which was registered by the Sub-Registrar. The petitioners challenged the registration of this revocation deed. The 3rd respondent contended that the settlement was incomplete since the settlor retained life interest and possession.
Findings of Court:
The court found that the settlement deed created a vested interest in favour of the petitioners as there were no contingent conditions precedent. The reservation of life interest is not a ground for unilateral revocation. Allegations of fraud or coercion must be adjudicated by a competent Civil Court and cannot be the basis for a Sub-Registrar to register a unilateral cancellation deed.
Issues: Whether the retention of life interest and denial of alienation rights during the settlor's lifetime prevents the creation of a vested interest and thus allows the unilateral cancellation of the settlement deed.
Ratio Decidendi: The court ruled that a vested interest is created when a present right to future enjoyment is granted. Such an interest is not defeated by the postponement of enjoyment or the reservation of a prior interest. A settlement deed creating a vested interest cannot be unilaterally cancelled by the settlor; any challenge based on fraud or coercion must be filed in a Civil Court.
Result: Writ Petition allowed; registration of the revocation deed quashed.
Legal Category Hierarchy
- property law
- practice and procedure
- statutory interpretation
Table of Contents
2. Petitioners argued unilateral cancellation impermissible; respondents contended settlor retained life interest, so no vested right passed. (Para 5 , 3 , 4 )
3. The settlement deed created vested remainder in petitioners; no condition precedent was imposed; postponement of enjoyment does not negate vesting. (Para 12 , 16 , 17 , 18 , 21 )
4. A settlement deed creating a vested interest cannot be unilaterally cancelled by the settlor; cancellation requires civil court intervention. (Para 22 , 23 )
5. Registration of revocation deed quashed as null and void; liberty granted to respondent to seek remedy in civil court. (Para 24 , 25 )
6. What is the distinction between a vested interest and a contingent interest under property law?
A vested interest exists when there is an immediate right of present enjoyment or a present right for future enjoyment, not dependent on a condition. (Para 19 , 20 )
7. Can a settlement deed that reserves a life interest and postpones enjoyment and alienation be unilaterally cancelled?
No. Postponement of enjoyment or alienation does not defeat the vested interest created; only a civil court can cancel it. (Para 16 , 17 , 18 , 21 , 22 )
8. Can a registrar accept a deed of unilateral cancellation of a settlement deed without the settlee's consent?
No. Unless the settlement deed imposes conditions on the settlee, unilateral cancellation must be refused; otherwise, it is non est. (Para 6 , 23 )
Prayer: Writ Petition under Article 226 of the Constitution of India, praying for the issuance of a Writ of Certiorari, to call for the records of the document dated 31.12.2013 and registered as Doc.No.5149 of 2013, on the file of the first respondent and to quash the same.
For Petitioners : Mr.Sunnysheen
for M/s.V.Raghavachari
For Respondents : Mr.U.Baranidharan
Additional Government Pleader
for R1, R2
Mr.C.Manishankar
Senior Counsel
for M/s.C.S.Kiran
for R3
ORDER
This Writ Petition has been filed challenging the registration of the revocation of settlement deed dated 31.12.2013 as Document No.5149 of 2013, by the 1st respondent.
2. The case of the petitioners is that Mrs.Ishwari Bai, who is the mother of the 1st and 2nd petitioners and the grandmother of the 3rd petitioner executed a settlement deed dated 01.10.2009 in favour of the petitioners and it was presented for registration before the 1st respondent and registered as Document No.3479 of 2009. The further case of the petitioners is that the subject property that was settled in favour of the petitioners vested in them absolutely.
3.It is stated that Iswari Bai passed away at the age of 88, on 03.03.2015. All of a sudden, the 3rd respondent who is the brother of the 1st and 2nd petitioners started claiming absolute right over the subject property on the basis of a settlement deed dated 31.12.2013. When the petitioners enquired about the same, it came to their knowledge that the said Ishwari Bai had unilaterally cancelled the settlement deed dated 01.10.2009 through the revocation deed dated 31.12.2013. Aggrieved by the registration of the revocation deed by the 1st respondent, whereby the settlement deed executed in favour of the petitioners was unilaterally cancelled, the present Writ Petition has been filed questioning the same.
4.The 3rd respondent has filed a counter affidavit and he has taken a stand to the effect that the settlement deed dated 01.10.2009 was brought about by the petitioners by perpetrating fraud, coercion and undue influence on the mother. The further stand taken by the 3rd respondent is that the property in question never vested with the petitioners absolutely since the settlor had retained life interest over the property and she never handed over possession to the petitioners and the petitioners were not even given the power of alienation. It is further stated that the mother, immediately on coming to know of the fraudulent document, cancelled the same through a deed of revocation dated 31.12.2013 and on the same day, an irrevocable settlement deed was executed in favour of the 3rd respondent and the 3rd respondent became the absolute owner of the property. Thereafter, the 3rd respondent also dealt with the property by executing a mortgage on 02.01.2014 for securing the loan taken by him for his business purposes. The mother passed away on 3.03.2015 and taking advantage of the same, the present Writ Petition came to be filed subsequently. Hence, the 3rd respondent has questioned the very maintainability of this Writ Petition and sought for the dismissal of the Writ Petition.
5. The above Writ Petition came up for hearing on 17.8.2022 and this Court passed the following order:
This Court heard the learned counsel for the petitioner and the learned Senior Counsel appearing on behalf of the 3rd respondent.
2.The learned counsel for the petitioner by relying upon the latest judgment of the Hon'ble First Bench in W.A.No.984 of 2022, dated 24.06.2022, submitted that the Sub Registrar does not have the power or the authority even to entertain a document which seeks to unilaterally cancel an earlier document. Therefore, according to the learned counsel for the petitioner, there is no requirement to go into disputed facts and the writ petition has to be allowed on this ground alone. The learned counsel also brought to the notice of this Court the Judgment of the learned Single Judge in W.P.No.17232 of 2021, dated 27.07.2022, wherein, the Division Bench Ju
