Registration of Court Decree Mandatory or not

CA No.6835/2009 Titled Gurcharan Singh & Ors v/s Angrez Kaur & Ans dated 19.03.2020 held

Bhoop Singh Vs. Ram Singh Major and Others, (1995) 5 SCC 709. In Bhoop Singh (supra), this Court laid down following in paragraphs 16, 17 and 18:-

“16. We have to view the reach of clause (vi), which is an exception to sub-section (1), bearing all the aforesaid in mind. We would think that the exception en grafted is meant to cover that decree or order of a court, including a decree or order expressed to be made on a compromise, which declares the pre-existing right and does not by itself create new right, title or interest in praesenti in immovable property of the value of Rs 100 or upwards. Any other view would find the mischief of avoidance of registration, which requires payment of stamp duty, embedded in the decree or order.

17. It would, therefore, be the duty of the court to examine in each case whether the parties have pre-existing right to the immovable property, or whether under the order or decree of the court one party having right, title or interest therein agreed or suffered to extinguish the same and created right, title or interest in praesenti in immovable property of the  value of Rs 100 or upwards in favour of other party for the first time, either by compromise or pretended consent. If latter be the position, the document is compulsorily registrable.

18. The legal position qua clause (vi) can, on the basis of the aforesaid discussion, be summarized as below:

(1) Compromise decree if bona fide, in the sense that the compromise is not a device to obviate payment of stamp duty and frustrate the law relating to registration, would not require registration. In a converse situation, it would require registration.

(2) If the compromise decree were to create for the first time right, title or interest in immovable property of the value of Rs 100 or upwards in favour of any party to the suit the decree or order would require registration.

(3) If the decree were not to attract any of the clauses of subsection (1) of Section 17, as was the position in the  aforesaid Privy Council and this Court’s cases, it is apparent that the decree would not require registration.

(4) If the decree were not to embody the terms of compromise, as was the position in Lahore case, benefit from the terms of compromise cannot be derived, even if a suit were to be disposed of because of the compromise in  question.

(5) If the property dealt with by the decree be not the “subject matter of the suit or proceeding”, clause (vi) of sub-section (2) would not operate, because of the amendment of this clause by Act 21 of 1929, which has its origin in the aforesaid decision of the Privy Council, according to which the original clause would have been attracted, even if it were to encompass property not litigated.

This Court in a recent judgment in Civil Appeal No.800 of 2020 – Mohammade Yusuf & Ors. Vs.

Rajkumar & Ors. decided on 05.02.2020 had occasion to consider Section 17 as well as judgment of Bhoop Singh (supra). While elaborating Section 17, this Court laid down following in paragraph 6:-

“6. A compromise decree passed by a Court would ordinarily be covered by Section 17(1)(b) but sub section(2) of Section 17 provides for an exception for any decree or order of a Court except a decree or order expressed to be made on a compromise and comprising immovable property other than that which is the subject-matter of the suit or proceeding. Thus, by virtue of sub section(2) (vi) of Section 17 any decree or order of a Court does not require registration. In sub-clause(vi) of subsection (2), one category is excepted from sub-clause(vi), i.e., a decree or order expressed to be made on a compromise and comprising immovable property other than that which is the subject-matter of the suit or proceeding. Thus, by conjointly reading Section 17(1)(b) and Section 17(2)(vi), it is clear that a compromise decree comprising immovable property other than which is the subject matter of the suit or proceeding requires registration, although any decree or order of a Court is exempted from registration by virtue of Section 17(2)(vi). A copy of the decree passed in Suit No.250-A of 1984 has been brought on record as Annexure P-2, which indicates that decree dated 04.10.1985 was passed by the Court for the property, which was subject matter of the suit. Thus, the exclusionary clause in Section 17(2)(vi) is not applicable and the compromise decree dated 04.10.1985 was not required to be registered on plain reading of Section 17(2)(vi)………………………….“

15. In the above case, this Court further relied on earlier judgment of this Court in Som Dev and Others Vs. Rati Ram and Another, (2006) 10 SCC 788 in paragraph 13 and laid down following:-

“13. This Court in Som Dev and Others Vs. Rati Ram and Another, (2006) 10 SCC 788 while explaining Section 17(2)(vi) and Section 17(1)(b) and (c) held that all decree and orders of the Court including compromise decree subject to the exception as referred that the properties that are outside the subject matter of the suit do not require registration. In paragraph 18, this Court laid down following:-

“18. ……………But with respect, it must be pointed out that a decree or order of a court does not require registration if it is not based on a compromise on the ground that clauses (b) and (c) of Section 17 of the Registration Act are attracted. Even a decree on a compromise does not require registration if it does not take in property that is not the subject-matter of the suit…………………….”