E.R.Kalaivan v. The Inspector General of Registration Santhome High Road Chennai 600 0282

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 09.07.2009CORAMTHE HONOURABLE MR.JUSTICE D.MURUGESANANDTHE HONOURABLE MR.JUSTICE K.VENKATARAMANW.A.No.507 of 2009E.R.Kalaivan ..Appellant -Vs-1. The Inspector General of Registration Santhome High Road Chennai 600 0282. The Sub-Registrar Registration Officer Kalayarkoil Sivaganga Taluk & District ..RespondentsAppeal filed under Clause 15 of the Letters Patent against theorder dated 19.2.2009 made in W.P.No.36093 of 2007. This WritPetition 36093 of 2007 presented to this Court under Article 226 ofthe Constitution of India to issue a Writ of Certiorarified Mandamusto call for the records leading to the passing of the impugnedcircular No.39789/E1/2007 dated 05.10.2007 passed by the 1strespondent and the consequential check slip dated 25.10.2007 issuedby the 2nd respondent by quashing the same and consequently issued adirection directing the 2nd respondent to register the cancellationdeed dated 25.10.2007 executed by the petitioner. For Appellant::MrK.Bijai Sundar For Respondents::Mr.J.Raja KalifullahGovernment Pleader JUDGMENT(Judgment of the Court was delivered by D.MURUGESAN, J.) Writ Appeal is against the order of the learned single Judge ofthis Court made in W.P.No.36093 of 2007 dated 19.2.2009. https://hcservices.ecourts.gov.in/hcservices/

This writ appeal raises an important question as to whetherthe Registrar, who is empowered to register the documents under the Indian Registration Act, could register a document unilaterallyexecuted by the vendor cancelling the earlier sale made.

The facts leading to the above issue arise on the followingcircumstances: By a registered Document No.81 of 2001 dated 5.2.2001 on thefile of the Sub-Registrar, Kalaiyarkoil, the appellant sold an extentof 0.90 cents to one Kannathal, Wife of (late) Ramasamy Konar of Aralikottai Village. Subsequently, the appellant approached the Sub-Registrar for registration of a deed of cancellation dated 6.1.2006on the ground the sale deed is not supported by consideration. Itappears that the Registrar was reluctant to entertain such a documentand refused to register the same apparently on the ground that thecancellation deed was sought to be registered without there being aconsent from the purchaser. Hence, the appellant approached the Inspector General of Registration. The Inspector General of Registration issued a circular dated 5.10.2007, whereby all DeputyInspector Generals of Registration, District Registrars and all Sub-Registrars were directed that the deed of cancellation should bearthe signatures of both the vendor and the purchaser. This circularcame to be challenged before this Court and by the impugned order, the writ petition was dismissed. Hence, the present writ appeal.

We have heard Mr.K.Bijai Sundar, learned counsel for theappellant and Mr.J.Raja Kalifullah, learned Government Pleader forthe respondents.

Mr.K.Bijai Sundar, learned counsel appearing for theappellant has submitted that in the absence of any provision, the Registrar cannot refuse to register a deed even in case of a deed ofcancellation. In this regard, he would submit that the State hasinserted the provisions of Section 22-A to the Registration Act bythe Registration (Tamil Nadu Amendment) Act, 1994 (for short, "the Act"). By that provision, the Registrar was restrained fromregistering a cancellation deed in the absence of both the parties tothe document. He would submit that the said provision was questionedbefore a Division Bench of this Court in the judgment in CaptainDr.R.Bellie v. Sub-Registrar, (2007) 3 MLJ 1025 and the saidprovision was struck down on the ground that the State Legislaturehad not laid down any guidelines defining "public policy" ordocuments which are "as opposed to public policy. " He would alsosubmit that the G.O.Ms.No.150, Commercial Taxes Department dated22.9.2000 issued pursuant to the amended provisions of Section 22-Awas also set aside.

He would also rely upon the subsequent G.O.Ms.No.139,Commercial Taxes and Registration (J1) Department dated 25.7.2007 https://hcservices.ecourts.gov.in/hcservices/ issued pursuant to the order of the Division Bench in CaptainDr.R.Bellie's case (supra). Placing reliance on the above judgmentas well as the notification, he would submit that the cancellation ofsale deed without express consent of parties to the document is oneof the categories referred to in the Government Order dated22.9.2000. Hence, when this Court in Captain Dr.R.Bellie's casedeclared the amended provision of Section 22-A of the Act is null andvoid and the consequential Government Order dated 22.9.2000 came tobe set aside, the Registrar cannot refuse to register a deed ofcancellation of sale deed on the ground that no consent of purchaserwas obtained and that too, in the absence of any specific provisionfor the insistence of consent from the purchaser. He would alsosubmit that inasmuch as the said Division Bench judgment was renderedfollowing the judgment of the Supreme Court in State of Rajasthan v.Basant Nahata, 2005 (4) CTC 606 and a similar order of the DivisionBench made in Writ Appeal No.1923 of 2005 dated 16.11.2005 dismissingthe appeal preferred by the State on the very same issue, theappellant must succeed and the appellant should be declared to beentitled to present the document of cancellation of sale deed forregistration.

On the other hand, Mr.J.Raja Kalifullah, learned GovernmentPleader would submit that a similar question came up forconsideration before this Court in Writ Appeal No.194 of 2009 and byjudgment dated 1.4.2009, this Court held that such a registration ofcancellation deed cannot be entertained in the absence of thesignature of the purchaser and in that view, the deed of cancellationwas set aside by the Division Bench. He would also rely upon thesubsequent Division Bench judgment dated 23.6.2009 in Writ AppealNo.789 of 2009 taking the same view. He would further submit that infact an amendment was made by inserting Section 34-A to the Act andby that amendment, no document for sale of the property shall beregistered, unless the person claiming under the document shall alsosign in such document. He would submit that though the amendedprovision of Section 22-A of the Act was struck down and the circularissued in terms of the said amendment was also set aside by this Court, in the absence of any provision empowering the Registrar toentertain such a document for cancellation, there is nothing wrong inthe Inspector General of Registration issuing a circular making itcompulsory for both the vendor and the purchaser to sign thedocument. He would also submit that by the circular dated 5.10.2007,the Inspector General of Registration has directed that whenevercancellation of sale deeds are sought to be registered and only thevendor signs the document, without the signature of the purchaser, entertaining such a document is not a proper procedure forregistration. That circular was issued in terms of Section 34-A ofthe Registration Act. 8. We have given our anxious thought to the rival contentions. In Basant Nahata's case, the Supreme Court, of course, on a challenge https://hcservices.ecourts.gov.in/hcservices/ to the amended provision of Section 22-A by the State of Rajasthan, had struck down the said provision on the ground that the word"public policy" was not defined and the essential function of thelegislature to decide what is public policy cannot be delegated tothe executive through subordinate legislation. In fact, a similaramended provision of Section 22-A by the State of Tamil Nadu wasconsidered by a Division Bench in Captain Dr.R.Bellie's case and onthe same reason, the said Section was also struck down.

From the above judgments, all that we could read andunderstand is that in the absence of any guidelines defining what is"public policy" or documents which are "as opposed to public policy",the Courts had to declare Section 22-A is null and void. In ouropinion, a reading of those judgments does not indicate that by thejudgments it is also directed that a registration of a cancellationdeed is permissible even in the absence of both the parties beforethe Registrar. The question as to whether such documents can beentertained should be considered in the light of the other provisionsof the Act as well.

We may little bit elaborate on this. The Government of Tamil Nadu inserted Section 22-A to the Registration Act empoweringthe State Government by notification in the Tamil Nadu GovernmentGazette to declare the registration of any document or class ofdocuments is opposed to public policy. In exercise of the saidpower, the Government issued G.O.Ms.No.150, Commercial TaxesDepartment dated 22.9.2000, which needs the full extraction and is asfollows:-"In exercise of the powers conferred by sub-section (1) of Section 22-A of the RegistrationAct, 1908 (Central Act XVI of 1908), the Governorof Tamil Nadu hereby declares the followingdocuments as opposed to public policy, namely,(1) Any instrument relating to: (i) conveyance of properties belonging to the Government or the local bodies such as the ChennaiMetropolitan Development Authority or Corporations, or Municipalities, or Town Panchayats or PanchayatUnions, or Village Panchayats; or(ii) conveyance of properties belonging to anyreligious institution including temples, mutts orspecific endowments managed by HereditaryTrustees/Non Hereditary Trustees appointed to anyreligious institutions under a Scheme settled ordeemed to have been settled under the provisions ofthe Tamil Nadu Hindu Religious and Charitable https://hcservices.ecourts.gov.in/hcservices/ Endowments Act, 1959 (Tamil Nadu Act 22 of 1959)and mutts and temples including specific endowmentsattached to such of those temples managed by mutts; or(iii) conveyance of properties assigned to orheld by(a) the Tamil Nadu State Bhoodan Yagna Boardestablished under Section 3 of the Tamil NaduBhoodan Yagna Act, 1958 (Tamilnadu Act XV of 1958);or(b) the Tamil Nadu Wakf Board.

Section 17 of the Act deals with documents whereregistration is compulsory and Section 18 deals with the documentswhere registration is optional. A reading of Section 17(b) showsthat a deed of cancellation of sale falls within the purview of that Section, since such document declares no right and title of immovableproperty. As the said document is compulsorily registrable, somerestrictions must be applied for cancellation of such document aswell.

In this content, we may also refer to Section 32-A of the Indian Registration Act providing that all such deeds shall be signedby the vendor as well as the purchaser and the same shall also bearthe finger prints and photographs. Section 34 of the Act also needs https://hcservices.ecourts.gov.in/hcservices/ a reference, whereby the Registering Authority is mandated to hold anenquiry in respect of the validity of the document presented forregistration. Having regard to the above provisions, in our opinion,a registered sale deed, if sought to be cancelled, registration ofsuch deed must be at the instance of both the parties viz.,bilaterally and not unilaterally. Section 34-A of the Act, wherebythe Registering Authority is to enquire whether or not such documentwas executed by the persons by whom it purports to have beenexecuted. A sale is essentially an executed contract between twoparties on mutal agreed conditions. Question is as to whether suchcontract can be unilaterally rescinded, particularly, in a case ofsale deed. In this context, we may refer to Section 62 of the IndianContract Act, 1872 which provides that contract which need not beperformed. By that provision, any novation, rescission andalteration of a contract can be made only bilaterally. A deed ofcancellation will amount to rescission of contract and if the issuein question is viewed from the application of Section 62 of the Indian Contract Act, any rescission must be only bilaterally. SeeCity Bank N.A. v. Standard Chartered Bank and others, 2004 (1) SCC 12.

Much reliance was placed to the Full Bench judgment of Andhra Pradesh High Court in Yanala Malleshwari and others v.Ananthula Sayamma and others, 2007 (1) CTC 97, wherein it was heldthat the cancellation of agreement of sale unilaterally by one partyto the agreement is valid. Pursuant to the judgment, the Governmentof Andhra Pradesh introduced Rule 26(k) to the Andhra PradeshRegistration Rules by means of an amendment dated 29.11.2006, whichreads as follows: "(i) The Registering Officer shall ensure atthe time of presentation for registration ofcancellation deeds of previously registered deedof conveyance on sale before him that suchcancellation deeds are executed by all executantand claimant parties to the previously registeredconveyance on sale and that such cancellation deedis accompanies by a declaration showing mutualconsent or orders of a competent civil or HighCourt of State or Central Government annulling thetransaction contained in the previously registereddeed of conveyance on sale; Provided that the registering officer shalldispense with the execution of cancellation deedsby executant and claimant parties to thepreviously registered deeds of conveyance on salebefore him if the cancellation deed is executed bya civil Judges or a Government Officer competentto execute Government Orders declaring theproperties contained in the previously registered https://hcservices.ecourts.gov.in/hcservices/ conveyance on sale to be Government or Assigned or Endowment lands or properties not registrable byany provision of law. (ii) Save in the manner provided for above, no cancellation deed of a previously registereddeed of conveyance on sale before him shall beaccepted for presentation of registration. "

The said Rule 26(k) was challenged before the Andhra PradeshHigh Court in Kalitha Narasimha v. The State Government of A.P., rep.by its Principal Secretary (W.P.No.3744/2007) by contending that thesame is ultra vires of the provisions of the Registration Act, 1908and is contrary to the judgment of the Full Bench in YanalaMalleshwari and others case. The Division Bench of the AndhraPradesh High Court, by order dated 13.3.2007, while upholding thesaid Rule, has held as follows:-"In our opinion, the impugned rule does notin any manner violate the ratio of the majorityjudgment of the Full Bench. Rather, as mentionedabove, it is a statutory embodiment of one of therules of natural justice and is intended tocurtain unnecessary litigation emanating from theex parte registration of cancellation deeds. "

As indicated in the above judgment, the principles ofnatural justice are also to be adhered to by the Registering Officerwhile dealing with a deed of cancellation of sale. If a unilateralcancellation deed is allowed to be registered, without the knowledgeand consent of the other party to the earlier contract, as held bythe Division Bench of the Andhra Pradesh High Court, suchregistration would cause violence to the principles of naturaljustice and lead to unnecessary litigation emanating therefrom.

By the said Rule 26(k)(ii), it was directed that nocancellation deed of a previously registered deed of conveyance onsale before him shall be accepted for presentation for registration.

That Rule was questioned before the Andhra Pradesh HighCourt in the case of Kalitha Narasimha v. The State Government ofA.P., in W.P.No.3744 of 2007 and on the ground that the amendment wascontrary to the judgment of the Full Bench in the case of YanalaMalleshwari and others v. Ananthula Sayamma and others, 2007 (1) CTC97. By order dated 13.3.2007, the Division Bench of Andhra PradeshHigh Court had upheld the said Rule and as on today, the Rule thatprevails in Andhra Pradesh is that the cancellation deed ofpreviously registered deed of conveyance on sale cannot be acceptedfor presentation by the Registrar unilaterally. https://hcservices.ecourts.gov.in/hcservices/

In this context, we may also usefully refer to the judgmentof a learned single Judge of this Court in G.D.Subramaniam v. TheSub-Registrar, Konur, 2009 CIJ 243 Madras. The learned Judge hasextensively considered the scope of registration of cancellation ofsale deed and had ultimately held that such unilateral cancellationof deed cannot be made in the absence of any specific provision forthe Registrar to do so. We are entirely in agreement with the saidview taken by the learned single Judge.

That apart, on the facts of this case, our attention is notdrawn to any of the specific provision under the Registration Actempowering the Registrar to entertain a document of cancellation forregistration on the ground that the sale consideration was not paidand consequently, received by the vendor. Further, in our opinion, when the Registrar satisfies himself on the perusal of the document, wherein it is stated that the full sale consideration is received andon such satisfaction, entertain the document for registration, cannotthereafter be conferred with a power for cancellation of the deed onthe ground that the full sale consideration was not paid and receivedby the vendor. Conferring such power on the Registrar wouldtantamount to conferring a power to decide the disputed questions. That apart, as already stated, in the absence of any provisionspecifically empowering the Registrar to entertain a document ofcancellation for registration, without the signature of both thevendor and the purchaser, the deed cannot be entertained. For thesaid reason, we find no infirmity in the impugned circular issued bythe Inspector General of Registration.

There is one more aspect. A person, who claims that thesale consideration has not been paid, as some undertaking was givenat the time of registration, is not without any remedy. A provisionof cancellation of such deed of registration is also available toenable such of those vendors to approach the civil Court and redresstheir grievance. In this context, the judgments of the Supreme Courtas well as the Division Bench of this Court are not of any assistanceto the appellant on the facts of this case as, particularly, in thosetwo cases, the prime consideration was whether a document which isopposed to public policy could be registered or not. Merely becausethe words "cancellation deed" was also incorporated in the GovernmentOrder dated 22.9.2000, which was subsequently set aside by the Division Bench, that would not give a right for a vendor to presentthe document of cancellation of the sale deed for registrationwithout reference to the purchaser. If such a situation is allowed, it would certainly put the purchaser in trouble. Further, the Division Bench of this Court in Writ Appeal No.194 of 2009, byjudgment dated 1.4.2009, had in fact set aside such a document ofcancellation which was registered. The said judgment of the DivisionBench was subsequently followed by another Division Bench in WritAppeal No.789 of 2009 dated 23.6.2009. We are entirely in agreementwith those Division Bench judgments and for all the reasons recorded https://hcservices.ecourts.gov.in/hcservices/ in this judgment, we are not inclined to interfere with the impugnedorder dated 19.2.2009.

As regards to the reference of the judgment in Writ AppealNo.1923 of 2005, we may point out that none of the above points wereeither advanced or argued or discussed in the said judgment andtherefore, the said judgment is not useful to the appellant.

For all the above reasons, the writ appeal fails and it isdismissed. No costs.sd/-Asst. Registrar/true copy/Sub Asst. RegistrarssTo1. The Inspector General of Registration, Santhome High Road, Chennai 600 028.2. The Sub-Registrar/Registration Officer Kalayarkoil Sivaganga Taluk & District.+ 1 c.c. to Mr. K. Bijai Sundar, Advocate. S.R.No.29899.+ 1 c.c. to The Government Pleader. S.R.No.29966.W.A.No.507 of 2009MBS (CO)GSK 12.08.2009.