Madhur Sah v. Thag Sah

1. In this case the facts are, that the plaintiff obtained on 23rd July, 1912, a deed of sale executed by defendant 1 and duly attested in respect of the property in suit. This document was not then and has not up to date been registered. On 13th August, 1912, defendant 1 sold the same property to defendant 2 by a document duly registered. The plaintiff thereupon instituted a suit against both defendants, the relief asked for being, first, that defendant 1 should be required either to register the existing unregistered sale-deed or to execute and register a second sale-deed and against defendant 2 he asked for a declaration that the transaction between defendant 2 and defendant 1 was null and void by reason of the previous transaction with the plaintiff and should be so declared null and void and possession of the property delivered to the plaintiff. Daring the pendency of the suit defendant 1 compromised the case with the plaintiff and executed and registered a fresh document as desired by the plaintiff. Defendant 2 continued to contest the suit. The lower Courts held that the suit as framed was not maintainable and conourred in dismissing the plaintiff's suit. Against these decisions a second appeal is laid in this Court. The judgment delivered by the lower appellate Court begins: “This was not a suit for the specific performance of a contract.” I do not see how a Suit for specific performance could have been framed otherwise than in the frame of the present suit. Under Sections 27(a) and 27(b) of the Specific Relief Act, the plaintiff was entitled to a decree for specific performance as against defendant 1, and for possession as against defendant 2 if defendant 2 could have been shown to have had knowledge of the plaintiff's contract at the time when he entered into his own contract. Clearly it was a suit for specific performance.

2. The lower Courts seem to have converted it into a suit for the registration of documents and to have discussed only cases in which suits for the registration of a document were either maintained or dismissed. This case, in my opinion, is a perfectly simple one under the Specific Relief Act and must be remanded to the lower Courts for further consideration. There is now no question of any suit against defendant 1 for registration. That part of the suit has been compromised between the plaintiff and defendant 1. The original document remains unregistered. The registered document is dated subsequent to the document of defendant 2. The point in issue is very simple. Is the plaintiff's second document void by reason of the title of defendant 1 having passed by his sale to defendant 2? Or is defendant 2's title void by reason of an existing contract between the parties of which he was fully aware? The only point for consideration is, whether the unregistered document can be considered as evidence of this contract? Great stress has been laid upon the case of Surendra Nath Nag Chowdhury v. Gopal Chunder Ghose (1) and the long line of case-law quoted therein. That case was a clean case under Section 27(a) of the Specific Relief Act, and inasmuch as in a case of this description the contract itself does not affect the property until it has been reduced to writing and registered, it may be said that an unregistered deed may be used as evidence of that contract as between the contracting parties, but I cannot take that decision to be authority for the proposition that in a case against third parties under S. 27(6) an unregistered deed can be used in evidence, for it is clear that the existence of the previous contract is of vital importance in the case.

3. The contract itself is a transaction affecting property, and I hold that an unregistered sale-deed cannot be used in evidence of a contract which in itself affects property. The appeal is, therefore, decreed and the suit remanded for inquiry upon two issues by the lower appellate Court upon the evidence recorded by the Court of first instance. The first of these issues is: Was there a valid contract between the plaintiff and defendant 1 prior to the registered conveyance to defendant 2; and was defendant 2 aware of this prior contract? If either or both of these issues are decided in favour of the defendant the suit will be dismissed. If both issues are decided in favour of the plaintiff his suit will be decreed.

4. In the decision of these issues the lower appellate Court will take heed that the unregistered deed is not to be used in evidence. If it appears that it is necessary to take further evidence on the question of the defendant's knowledge of the previous contract, the lower appellate Court is directed to remand the suit for the taking of such evidence. Costs to follow the result.

V.S/R.K

5. Appeal decreed.