No Compulsory Registration for Assignment of Decrees for Specific Performance
Commentary on Rajeswari & Ors. v. Shanmugam & Anr., 2025 INSC 1329

1. Introduction

The Supreme Court of India’s decision in Rajeswari & Ors. v. Shanmugam & Anr. (Civil Appeal No. 13835 of 2025, arising out of SLP (C) No. 3532 of 2018), decided on 19 November 2025, squarely addresses a recurring but often misunderstood question at the intersection of property law, civil procedure, and registration:

“Should a deed assigning a decree for specific performance of an agreement of sale of immovable property be registered under the provisions of the Registration Act, 1908?”

The Court (K.V. Viswanathan, J., with J.B. Pardiwala, J. concurring) answers this in the negative, holding that a deed assigning a decree for specific performance of a contract of sale of immovable property is not compulsorily registrable under Section 17(1)(e) of the Registration Act, 1908 (“Registration Act”), because such a decree does not itself create or transfer any right, title or interest in the immovable property.

In doing so, the Court:

• Clarifies the nature and effect of a decree for specific performance;
• Interprets the scope of Section 17(1)(e) of the Registration Act;
• Affirms the assignability of decrees under Order XXI Rule 16 of the CPC;
• Reconciles conflicting High Court views and expressly holds that the Andhra Pradesh High Court’s view in K. Bhaskaram “does not lay down the correct law”.

The judgment thus establishes an important precedent: an assignment of a decree for specific performance is essentially an assignment of a personal right to enforce a contract, not a transfer of an interest in immovable property, and hence does not attract compulsory registration under Section 17(1)(e).

2. Factual Background and Procedural History

2.1 The underlying suit and decree for specific performance

The litigation has its genesis in a suit for specific performance, O.S. No. 100 of 1989, before the First Additional Sub Court, Erode, Tamil Nadu.

• The defendant in that suit (predecessor of the present appellants) agreed to sell the suit property to the plaintiff (now Respondent No. 2).
• An ex parte decree dated 13.09.1993 was passed in favour of the plaintiff for specific performance of the agreement of sale.

The decree, in material terms, directed:

• The defendant to receive the balance sale consideration and execute a sale deed in favour of the plaintiff, free from encumbrances;
• In default, the plaintiff could obtain execution of the sale deed through court;
• Costs were awarded to the plaintiff; and
• One month’s time was granted for execution of the sale deed.

2.2 The assignment of the decree

The decree-holder (Respondent No. 2, K.T. Natarajan) then entered into a “Decree Made Over Deed” (Exhibit B1) dated 17.07.1995, in favour of Respondent No. 1, Shanmugam, for consideration of Rs. 20,000.

Under this deed:

• The decree-holder assigned to Shanmugam “the rights and interests of aforesaid suit, appeal, and decree, in full and absolute manner”.
• It was expressly provided that henceforth “all rights and interests arising out of the said suit, appeal, and decree shall belong solely to you” and that the assignee shall execute the sale deed through an execution petition.
• The assignor and his heirs disclaimed any future claim to the decree.

Crucially, this assignment deed was not registered.

2.3 Execution proceedings

The assignee of the decree (Respondent No. 1):

• Filed Execution Petition (E.P.) No. 150 of 2004 in O.S. No. 100 of 1989;
• Sought recognition as assignee of the decree under Order XXI Rule 16 CPC and requested execution of a sale deed and delivery of possession.

On 13.03.2008, the Executing Court:

• Ordered execution of the sale deed in favour of the assignee (Respondent No. 1).

2.4 Objections under Section 47 CPC

On 31.10.2009, the legal heirs of the judgment-debtor (appellants) invoked Section 47 of the Code of Civil Procedure, 1908 (“CPC”) by filing E.A. No. 180 of 2009. They sought:

• Setting aside of the sale deed executed pursuant to the Execution Court's order dated 13.03.2008; and
• Dismissal of the execution petition.

Their principal ground was that:

• The assignment deed (Exhibit B1) was an instrument assigning a decree relating to immovable property of value above Rs. 100;
• Therefore, under Section 17(1)(e) of the Registration Act, it was compulsorily registrable;
• Being unregistered, it was unenforceable, and Respondent No. 1 could not execute the decree.

2.5 Executing Court and High Court decisions

The Executing Court:

• Allowed E.A. No. 180 of 2009 on 08.04.2010;
• Relied heavily on the Andhra Pradesh High Court’s decision in K. Bhaskaram & Anr. v. Mohammad Moulana (died) & Ors., AIR 2005 AP 524;
• Held that under Sections 17(1)(e) and (f) of the Registration Act, assignment of a decree relating to immovable property valued over Rs. 100 requires compulsory registration;
• Concluded that the unregistered assignment deed (Ex. B1) was “bad for want of registration” and that execution cannot proceed.

On revision, the High Court:

• Reversed the Executing Court’s order;
• Held that what was assigned was merely a “right to derive benefit” from the decree, not any right, title or interest in immovable property;
• Relied on the Allahabad High Court decision in Mumtaz Ahmad & Anr. v. Sri Ram & Ors., (1913) 11 ALJR 815;
• Concluded that the assignment of such a decree need not be registered.

The matter then reached the Supreme Court by way of special leave at the instance of the judgment-debtor’s legal heirs.

3. Central Legal Issue

The Supreme Court framed and addressed a narrow but doctrinally significant question:

Does a deed assigning a decree for specific performance of an agreement of sale of immovable property require compulsory registration under Section 17(1)(e) of the Registration Act, 1908?

This, in turn, depended on the deeper question: does a decree for specific performance itself “create, declare, assign, limit or extinguish” any right, title or interest in immovable property? If it does, an instrument assigning such a decree would indeed fall within Section 17(1)(e). If it does not, that provision is inapplicable.

4. Summary of the Supreme Court’s Decision

The Supreme Court dismissed the appeal and upheld the High Court’s view, holding:

• A decree for specific performance does not by itself create or transfer any right, title or interest in the immovable property.
• It merely recognises and enforces a personal obligation under the contract and gives the decree-holder a right to obtain a conveyance (sale deed) through the process of court.
• Ownership or any proprietary interest passes to the decree-holder only upon execution and registration of a proper sale deed in his favour, either by the judgment-debtor or through the court.
• Section 17(1)(e) of the Registration Act applies only where the decree or order itself purports or operates to create, declare, assign, limit or extinguish a right, title or interest in immovable property.
• Since a decree for specific performance does not have that effect, an assignment of such a decree does not require registration under Section 17(1)(e).
• Accordingly, the assignment deed (Exhibit B1) in favour of Respondent No. 1, though unregistered, was valid and sufficient to entitle him, as transferee of the decree, to seek execution under Order XXI Rule 16 CPC.

The Court also:

• Explicitly approved and adopted the reasoning of the Bombay High Court in Amol & Ors. v. Deorao & Ors., 2011 SCC OnLine Bom 11;
• Expressly held that the contrary view in K. Bhaskaram (AP High Court) “does not lay down the correct law”.

5. Detailed Analysis

5.1 Nature and character of a decree for specific performance

The foundation of the Court’s conclusion lies in its careful articulation of the nature of a decree for specific performance.

Relying on Babu Lal v. Hazari Lal Kishori Lal, (1982) 1 SCC 525, the Court reiterated that:

• A decree for specific performance does not itself transfer title to the decree-holder.
• Title remains with the judgment-debtor until a sale deed is executed, either by the judgment-debtor or, in default, by the court in execution.
• Possession and title become enforceable rights in favour of the decree-holder only upon such conveyance.
• A decree for specific performance is “somewhat in the nature of a preliminary decree”: it sets out the contractual rights and entitlements but leaves various steps to be worked out in execution (including, where necessary, delivery of possession).

This approach is consistent with the long-standing jurisprudence that specific performance is an equitable remedy, where the court essentially “steps into the shoes” of the promisor, compelling them to do what they had agreed to do—but the actual transfer of ownership occurs only when the formal act of conveyance (execution and registration of the sale deed) is completed.

5.2 Contract for sale versus sale: Section 54, Transfer of Property Act

The Court then anchored its reasoning in the statutory scheme of the Transfer of Property Act, 1882 (“TPA”), especially Section 54.

Section 54 defines:

• “Sale” as a transfer of ownership in exchange for a price; and
• “Contract for sale” (agreement of sale) as a contract that a sale shall take place on agreed terms.

Crucially, Section 54 concludes:

“It [a contract for sale] does not, of itself, create any interest in or charge on such property.”

The Supreme Court, relying on Suraj Lamp & Industries (P) Ltd. v. State of Haryana, (2012) 1 SCC 656, reaffirmed that:

• An agreement for sale—even if accompanied by possession—does not convey title to immovable property.
• No right, title or interest in immovable property can be transferred without a duly stamped and registered deed of conveyance.
• Section 53A TPA (part performance) merely provides a defensive shield against the transferor, not a source of ownership or title.

Since a decree for specific performance is founded on the contract for sale, and the law is explicit that such contracts themselves create no proprietary interest, the Court found it logically untenable to treat the decree as if it had “elevated” the decree-holder to the status of an owner, or as if it had created an interest in the property.

5.3 Decree for specific performance does not extinguish the contract

Another conceptual pillar of the judgment is the recognition that the contract does not merge or get extinguished in the decree.

Section 28 of the Specific Relief Act, 1963 (“SRA”) allows:

• The vendor/lessor, even after a decree of specific performance, to seek rescission of the contract if the purchaser/lessee fails to pay the purchase money or comply with the decree within the time fixed.
• The purchaser/lessee to apply for further reliefs such as execution of a proper conveyance and delivery of possession, in the same suit.

This statutory mechanism rests on the assumption that, even post-decree, the underlying contract continues to subsist.

In Hungerford Investment Trust Ltd. v. Haridas Mundhra, (1972) 3 SCC 684, the Supreme Court held that:

“The contract between the parties was not extinguished by the passing of the decree, it subsisted notwithstanding the decree… the decree did not abrogate or modify any of the express or implied terms of the contract…”

This continuity of contract is incompatible with the notion that the decree by itself creates an interest in the property. If the decree had already effected a transfer of ownership, there would be little sense in allowing the vendor to seek rescission of the contract or restoration of possession under Section 28.

5.4 Construction of Section 17(1)(e) of the Registration Act

The heart of the statutory analysis lies in the correct understanding of Section 17(1)(e) of the Registration Act, 1908, which provides that registration is compulsory for:

“non-testamentary instruments transferring or assigning any decree or order of a Court or any award when such decree or order or award purports or operates to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property.”

The Court emphasizes that:

• The trigger for Section 17(1)(e) is not the mere existence of a decree relating indirectly to immovable property, but whether the decree itself “purports or operates” to create, declare, assign, limit or extinguish rights in immovable property.
• If the substantive rights in immovable property do not arise by virtue of the decree, but only upon a subsequent registered sale deed executed in pursuance of the decree, then the decree is not of the type contemplated by Section 17(1)(e).

Applying this to decrees for specific performance:

• Such decrees do not in themselves transfer ownership or create any charge or interest in the property.
• They merely entitle the decree-holder (and, by assignment, his transferee) to obtain execution of a sale deed through court.
• Therefore, an instrument assigning such a decree is not an instrument transferring any right, title or interest in immovable property, but only an assignment of a personal right to enforce a contract.

Consequently, Section 17(1)(e) is inapplicable, and such an assignment does not require registration.

5.5 Assignment of decrees under Order XXI Rule 16 CPC

The procedural framework enabling such assignments is located in Order XXI Rule 16 of the CPC, which reads:

“Where a decree … is transferred by assignment in writing or by operation of law, the transferee may apply for execution of the decree to the Court which passed it; and the decree may be executed in the same manner and subject to the same conditions as if the application were made by such holder…”

The Rule:

• Expressly contemplates assignment in writing of a decree or of an interest in a decree;
• Requires notice to the transferor and the judgment-debtor;
• Does not mandate that the assignment be registered (leaving the question to be determined by the Registration Act).

The Supreme Court notes that:

• There was no contention of non-compliance with the proviso to Order XXI Rule 16 in the present case;
• The existence of Order XXI Rule 16 confirms that decrees—including decrees for specific performance—are in principle assignable;
• The only question is whether the particular assignment falls within any category of documents that are compulsorily registrable. For decrees of specific performance, the Court holds that it does not.

5.6 Representative-in-interest and assignability of contractual rights

The decision also draws support from Section 15 of the Specific Relief Act, which provides that specific performance may be obtained not only by a party to the contract, but also by their “representative-in-interest”.

The Court notes that the term “representative-in-interest” includes an assignee of contractual rights, subject to well-known limitations on assignability:

• Rights under a contract are generally assignable unless:
  • the contract is personal in nature (involving personal skill, trust, credit, etc.); or
  • the contract expressly prohibits assignment.
• Obligations under a contract, by contrast, cannot be assigned without the consent of the other party; such an arrangement is legally a novation.

This distinction, explained in the Constitution Bench judgment in Khardah Company Ltd. v. Raymon & Co. (India) (P) Ltd., AIR 1962 SC 1810, and reiterated in Kapilaben & Ors. v. Ashok Kumar Jayantilal Sheth, (2020) 20 SCC 648, underpins the Court’s acceptance that:

• The decree-holder’s right to obtain specific performance is a contractual right that can be assigned;
• Such an assignment makes the assignee a “representative-in-interest” capable of seeking specific performance and executing the decree.

5.7 Treatment of precedents cited

5.7.1 Babu Lal v. Hazari Lal Kishori Lal

This decision is central to the present judgment. It clarified that:

• A decree for specific performance does not transfer title to the decree-holder;
• Title passes only on execution of the sale deed in execution proceedings;
• The decree for specific performance is akin to a preliminary decree; the executing court has plenary powers to do “all such things” that would give full effect to the decree, including delivery of possession.

The present judgment adopts this conceptualisation, rejecting the notion that any proprietary interest accrues to the decree-holder merely upon passing of the decree.

5.7.2 Suraj Lamp & Industries (P) Ltd. v. State of Haryana

Suraj Lamp is relied on for the principle that:

• An agreement to sell does not create any interest or charge in immovable property;
• Only a registered conveyance transfers ownership.

By invoking this authority, the Court underscores that:

• Both before and after the decree of specific performance, the underlying contract remains an agreement for sale, which, by statutory mandate, does not create an interest in property;
• The decree merely enforces that contractual obligation; it does not convert the contract itself into an instrument of conveyance.

5.7.3 Hungerford Investment Trust Ltd. v. Haridas Mundhra

This case is cited to support the proposition that:

• The contract is not extinguished by the decree for specific performance;
• The parties remain bound by its express and implied terms;
• There is an implied obligation to complete the contract within a reasonable time.

This reinforces the idea that the decree does not “replace” the contract as a source of proprietary rights; rather, it is a judicial recognition of the existing contractual obligation.

5.7.4 Amol & Ors. v. Deorao & Ors. (Bombay High Court)

The Supreme Court expressly endorses the reasoning of R.K. Deshpande, J. in Amol, which had held that:

• A decree for specific performance:
  • does not create any right, title or interest in the property;
  • is in the nature of a preliminary decree;
  • is subject to further processes, including execution of the sale deed and its registration.
• Section 17(1)(e) of the Registration Act applies only when the decree itself creates or operates upon proprietary rights;
• Therefore, an assignment of a decree for specific performance does not require registration.

The Supreme Court states: “We record our concurrence to the holding in the said paragraphs.” This effectively elevates the Amol reasoning to binding national precedent.

5.7.5 K. Bhaskaram v. Mohammad Moulana (AP High Court)

The Executing Court’s decision was heavily influenced by K. Bhaskaram, which held that assignment of a decree relating to immovable property requires registration.

The Supreme Court, however, notes that:

• In K. Bhaskaram, it appears the parties proceeded on an admission that registration was required;
• The AP High Court also found defects relating to compliance with Order XXI Rule 16 CPC;
• In any event, on the core question of the need for registration of assignment of a decree for specific performance, “the holding to the contrary in K. Bhaskaram … does not lay down the correct law.”

This is a clear and direct disapproval of the AP High Court approach and resolves the earlier conflict in judicial opinion.

5.7.6 Satish Kumar v. Surinder Kumar

The appellants relied on Satish Kumar & Ors. v. Surinder Kumar & Ors., (1969) 2 SCR 244, which considered Section 17(1)(b) of the Registration Act.

The Supreme Court distinguishes this authority on the basis that:

• Section 17(1)(b) and Section 17(1)(e) both refer to documents that themselves create or extinguish rights in immovable property;
• Given that a decree for specific performance does not create such rights, neither provision is attracted;
• Satish Kumar thus does not aid the appellants’ contention.

6. Complex Concepts Simplified

6.1 “Specific performance” as an equitable remedy

Specific performance is a remedy whereby the court orders a party to perform their contractual obligations in specie (i.e., to do exactly what they promised), instead of merely paying damages.

In the context of sale of immovable property, it usually means:

• The seller must execute a proper sale deed in favour of the buyer;
• Upon completion of the sale deed and its registration, ownership passes to the buyer.

The decree itself does not transfer the property; it is the court’s order compelling the seller (or, in default, empowering the court itself) to execute the conveyance.

6.2 Preliminary versus final decrees in specific performance

A preliminary decree declares the rights and obligations of the parties but leaves some further acts to be carried out (often in execution), while a final decree completely disposes of the suit.

In specific performance suits:

• The decree declaring that the plaintiff is entitled to have the sale deed executed is often described as being “in the nature of a preliminary decree”;
• Subsequent steps—such as execution of the sale deed, payment of balance consideration, and delivery of possession—are worked out in execution;
• Section 28 SRA allows the court to supervise this process and even rescind the contract if the purchaser defaults.

This explains why a decree for specific performance does not, and cannot, be treated as a conveyance of the property.

6.3 “Interest in or charge on immovable property”

An “interest” in immovable property (in this context) means a legally enforceable right that attaches to the property itself—such as ownership, mortgage, leasehold, easement, or charge.

The Court stresses that:

• The right to sue for specific performance is a personal right against the promisor, not a right in the property itself.
• Until a validly executed and registered sale deed is obtained, the prospective purchaser (even with a decree in hand) has no interest in the property in the sense contemplated by Section 54 TPA and Section 17 of the Registration Act.

6.4 Assignment of rights versus obligations

In contract law:

• Rights (e.g., the right to receive payment or to insist on performance) are generally assignable unless:
  • they are personal in nature (e.g., contracts involving special personal skill); or
  • the contract expressly prohibits assignment.
• Obligations (e.g., the duty to pay or perform) generally cannot be assigned without the consent of the other contracting party; any such arrangement is treated as novation.

In the present context:

• The decree-holder’s right to compel the seller to execute a sale deed is a contractual right and is assignable;
• The assignee thus becomes the “representative-in-interest” for purposes of seeking specific performance and executing the decree.

6.5 Section 17(1)(e) Registration Act: when does it actually apply?

Section 17(1)(e) requires registration of instruments that transfer or assign decrees or awards where the underlying decree or award itself operates on immovable property.

Examples (conceptually) where it may apply:

• An assignment of a decree that declares title in immovable property or creates a charge or encumbrance;
• An assignment of an award that directly transfers or extinguishes property rights.

In contrast, decrees for specific performance:

• Do not directly create or extinguish property rights;
• Merely direct execution of a conveyance in future;
• Hence fall outside Section 17(1)(e).

7. Practical and Doctrinal Impact

7.1 Clarification of a previously unsettled area

Judicial opinion had been divided, particularly due to the Andhra Pradesh High Court’s view in K. Bhaskaram and the contrary stance of the Bombay High Court in Amol.

This judgment:

• Resolves the conflict at the national level;
• Affirms Amol as laying down the correct law;
• Expressly declares that K. Bhaskaram does not state the law correctly in relation to assignment of decrees for specific performance.

7.2 Consequences for execution practice

For practitioners and courts dealing with execution of decrees for specific performance:

• An unregistered written assignment of such a decree is sufficient for the assignee to:
  • Apply under Order XXI Rule 16 CPC;
  • Seek recognition as transferee of the decree; and
  • Proceed with execution, including obtaining execution of the sale deed through court.
• Executing Courts should not refuse execution merely because the assignment deed is unregistered, so long as:
  • It is in writing;
  • Order XXI Rule 16 requirements (including notice) are complied with; and
  • The decree in question is one for specific performance and not itself creating property rights.

The judgment thus simplifies and rationalises execution practice, avoiding unnecessary insistence on registration where the statute does not require it.

7.3 Impact on property law and registration

Doctrinally, the judgment:

• Reaffirms a strict separation between:
  • Contracts for sale and decrees enforcing them; and
  • Conveyances (registered sale deeds) that actually transfer ownership.
• Preserves the core function of the Registration Act—to provide public notice of transactions that directly affect title to immovable property.
• Confirms that neither:
  • an agreement of sale, nor
  • a decree for specific performance thereof
  constitutes, by itself, a document that creates or transfers property rights requiring registration under Section 17(1)(b) or (e).

On the appellants’ policy argument that non-registration would allow parties to avoid stamp duty and registration charges by repeatedly assigning decrees for 12 years, the Court responds convincingly:

• Until a sale deed is executed and registered, no right in the property passes to any assignee;
• Thus, no conveyance takes place and no registration fee or stamp duty on a sale deed becomes payable;
• Revenue concerns arise only when there is an actual transfer of ownership—i.e., when the sale deed is executed and registered.

The Court therefore rejects the “avoidance of revenue” argument as misconceived.

7.4 Market for decrees and litigation finance

While not explicitly addressed, the judgment has broader implications:

• By confirming the validity of unregistered assignments of decrees for specific performance, it provides greater legal certainty for:
  • Assignees who purchase decrees as part of commercial arrangements;
  • Entities engaged in litigation finance or purchase of distressed assets where decrees for specific performance exist.
• At the same time, it ensures that property law principles are not diluted: assignees cannot claim ownership merely on the basis of the decree or its assignment; they must still procure a registered conveyance in execution.

7.5 Limits of the ruling

It is important to note what the judgment does not decide:

• It does not deal with:
  • Decrees that themselves declare title, create a charge, or partition immovable property; or
  • Awards that directly convey property rights.
  Assignments of such decrees or awards may still fall under Section 17(1)(e) and require registration.
• It does not address questions of stamp duty under state stamp laws on assignment deeds, which are conceptually distinct from compulsory registration under the Registration Act.

Thus, the ruling must be read as confined to decrees for specific performance of contracts for sale of immovable property.

8. Conclusion and Key Takeaways

Rajeswari v. Shanmugam provides a clear, principled, and well-integrated answer to a question that had generated conflicting High Court authority. The key holdings may be summarised as follows:

• A decree for specific performance of a contract for sale of immovable property:
  • Does not of itself create, declare, assign, limit, or extinguish any right, title, or interest in the immovable property;
  • Is “somewhat in the nature of a preliminary decree”, subject to further steps in execution;
  • Enforces a personal obligation arising from the contract, but does not itself serve as a conveyance.
• Ownership and proprietary rights in the immovable property:
  • Pass to the decree-holder (or his assignee) only upon execution and registration of a proper sale deed in execution of the decree;
  • Remain with the judgment-debtor until such conveyance is executed and registered.
• Section 17(1)(e) of the Registration Act, 1908:
  • Applies only where the decree, order, or award itself purports or operates to affect proprietary rights in immovable property;
  • Does not apply to decrees for specific performance, as such decrees do not themselves create or transfer property rights.
• Therefore:
  • An instrument assigning a decree for specific performance does not require compulsory registration under Section 17(1)(e);
  • An unregistered written assignment is valid for purposes of Order XXI Rule 16 CPC.
• The contrary view in K. Bhaskaram is held to be incorrect, while the Bombay High Court’s approach in Amol is expressly approved.

In the broader legal context, the judgment:

• Harmonises the doctrines of contract, property, and civil procedure;
• Reaffirms the centrality of the registered conveyance as the sole mode of transferring ownership of immovable property of value Rs. 100 and above;
• Clarifies that decrees for specific performance and assignments thereof occupy a fundamentally different juridical plane—they operate on personal obligations, not directly on the res (the property).

For litigants, decree-holders, assignees, and executing courts, Rajeswari v. Shanmugam offers much-needed certainty: assignment of a decree for specific performance is valid even without registration, and the assignee may execute the decree as if he were the original decree-holder, but no proprietary interest in the property arises until a proper sale deed is executed and registered in execution of the decree.