Unregistered “Agreement to Sell” is Admissible As Evidence in Suit For Specific Performance

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Published on: 14 April 2023 at 12:34 IST

Supreme Court Bench of Justice M.R. Shah and Justice Krishna Murari held that Section 17(1A) of the Registration Act, 1908 is the only exception to the Proviso of Section 49 of Registration Act. Thus, the Proviso to Section 49 shall apply to the documents other than the ones referred to in Section 17(1A).

Supreme Court added, that an unregistered Agreement to Sell, which is otherwise required to be compulsorily registered, shall be admissible in evidence in a suit for specific performance in terms of Proviso to Section 49 of Registration Act.

The only exception to the Proviso of Section 49 would be documents mentioned in Section 17(1A) of Registration Act (R. Hemalatha v Kashthuri).

In this case, the respondent is an original plaintiff instituted civil suit  for specific performance of the Agreement to Sell dated 10.09.2013. After the chief ­examination of the plaintiff as PW­1, on the application filed by the appellant – original defendant, a preliminary issue was framed by the Trial Court on the admissibility of the Agreement dated 10.09.2013 in evidence. 

It was the case on behalf of the defendant that in view of the Tamil Nadu Amendment Act No.29 of 2012 to the Indian Registration Act, under which the instruments of agreement relating to sale   of immovable property of the value of Rs.100/­ and upwards is compulsorily required to be registered, the said unregistered document shall be inadmissible in evidence.

On the other hand, relying upon Section 49(a) and (c) of the Act, it was submitted that an unregistered Agreement to Sell can be admitted as evidence of a contract in a suit for specific performance.

Trial Court held that preliminary issue in favour of the defendant and against the plaintiff by observing that the unregistered Agreement dated 10.09.2013 shall not be admissible in evidence.

Feeling aggrieved and dissatisfied with the order of the Trial Court, the plaintiff preferred the revision application before the High Court. By the impugned judgment and order, the High Court has allowed the revision.

CASE: R. HEMALATHA VS. KASHTHURI CIVIL APPEAL NO. 2535/2023 @SLP (C) No. 14884/2022) SUPREME COURT

Judgment