REG 050 Registration Act and Specific Relief Act — Law of Registration Notes for Judiciary

The Registration Act and the Specific Relief Act, 1963: Specific Performance, Cancellation, Declaration, Rectification, and the Suit under Section 77

The Registration Act tells you whether a document is any good. The Specific Relief Act, 1963 tells you what to do about it when it is not. The two meet at four places: a suit to compel the execution and registration of a conveyance, a suit to cancel a registered instrument, a suit to declare that a registered instrument does not bind the plaintiff, and a suit to rectify an instrument that does not express what the parties agreed. Running underneath all four is the proviso to Section 49, which lets an unregistered document be read as evidence of the contract it recorded, and which is therefore the bridge between a failed conveyance and a decree for specific performance.

The four remedies, the link through the proviso to Section 49, and the two suits that are constantly confused

1. The Unregistered Agreement and Specific Performance

Proviso to Section 49, Registration Act, 1908

Provided that an unregistered document affecting immovable property and required by this Act or the Transfer of Property Act, 1882 to be registered may be received as evidence of a contract in a suit for specific performance under Chapter II of the Specific Relief Act, 1877, or as evidence of part performance of a contract for the purposes of section 53A of the Transfer of Property Act, 1882, or as evidence of any collateral transaction not required to be effected by registered instrument.

The reference to the Act of 1877 is to be read as a reference to the corresponding provisions of the Specific Relief Act, 1963, by force of Section 8 of the General Clauses Act, 1897. The proviso is generous and it is decisive. A deed that fails as a conveyance, because it was required to be registered and was not, may still be read to prove that the parties agreed on a sale, and a decree may follow directing the vendor to execute and register a proper deed.

The document is read as a contract, not as a conveyance. That is the whole of the distinction. It cannot be used to show that the property passed; it can be used to show what the parties promised.
It applies to an unregistered sale deed as much as to an agreement. A sale deed that failed for want of registration contains, on its face, an agreement to sell, and may be sued upon as such.
It applies whether or not the document was compulsorily registrable. An agreement to sell which was never registrable at all is admissible without needing the proviso; the proviso is there for documents that were registrable and were not registered.
Section 17(1A) does not touch this. That sub section withdraws only the shield under Section 53A; it leaves the contract, and the remedy of specific performance, untouched.
The stamp objection must still be cleared. Section 35 of the Indian Stamp Act, 1899 admits of no collateral purpose, so an unstamped document cannot be read even to prove the contract until the duty and penalty are paid.

2. The Suit for Specific Performance

Sections 10 and 16(c), Specific Relief Act, 1963, as amended in 2018

10. Specific performance in respect of contracts. The specific performance of a contract shall be enforced by the court subject to the provisions contained in sub section (2) of section 11, section 14 and section 16.

16. Personal bars to relief. Specific performance of a contract cannot be enforced in favour of a person (c) who fails to prove that he has performed or has always been ready and willing to perform the essential terms of the contract which are to be performed by him, other than terms the performance of which has been prevented or waived by the defendant.

1. Since the amendment of 2018, specific performance is no longer discretionary in the old sense. Section 10 now says the court "shall" enforce it, subject to Sections 11(2), 14 and 16. Before the amendment it was a discretionary relief under the old Section 20, which was substituted.

2. Readiness and willingness must be pleaded and proved, and must be continuous from the date of the contract down to the hearing. This is the ground on which most such suits fail.

3. Limitation is governed by Article 54 of the Limitation Act, 1963: three years from the date fixed for performance, or, where no such date is fixed, from when the plaintiff has notice that performance is refused.

4. The decree directs execution, and does not itself transfer. Under Section 28, where a decree for specific performance of a contract for the sale of immovable property has been made and the purchaser does not pay within the period allowed, the vendor may apply to have the contract rescinded; and where the defendant will not execute, the court may execute the conveyance through an officer of the court under Order XXI Rule 34 of the Code of Civil Procedure.

5. That conveyance must still be registered. It is an ordinary registrable instrument, and Section 17(1)(b) applies to it exactly as to any other sale deed.

6. Section 22 permits the plaintiff to ask for possession or partition in the same suit, and the relief must be specifically claimed, though the court may allow the plaint to be amended at any stage on just terms.

3. Agreement to Sell and Conveyance Compared

	Agreement to sell	Conveyance
Provision	Section 54, third paragraph, Transfer of Property Act	Section 54, second paragraph
What it does	Records a contract that a sale shall take place	Transfers ownership
Interest created	None, expressly	Ownership vests in the purchaser
Registration	Not compulsory generally; Section 17(1A) applies where Section 53A is relied on	Compulsory above one hundred rupees, Section 17(1)(b)
Remedy of the buyer	Specific performance under the Specific Relief Act, 1963	Possession, as owner
If unregistered where registration was required	Still admissible to prove the contract, proviso to Section 49	No title passes, and the document proves no transfer
Limitation	Article 54: three years	Not applicable; the transfer is complete

4. The Section 77 Suit and the Specific Performance Suit

These two suits are constantly confused because both end in a document being registered. They are entirely different proceedings, against different defendants, on different issues, with different periods of limitation.

Sections 75 and 77, Registration Act, 1908, in substance

75(1). If the Registrar finds that the document has been executed and that the requirements of the law for the time being in force have been complied with, he shall order the document to be registered.

75(2). If the document is duly presented for registration within thirty days after the making of such order, the registering officer shall obey the same and thereupon shall, so far as may be practicable, follow the procedure prescribed in sections 58, 59 and 60; and such registration shall take effect as if the document had been registered when it was first duly presented for registration.

77(1). Where the Registrar refuses to order the document to be registered, any person claiming under such document, or his representative, assign or agent, may, within thirty days after the making of the order of refusal, institute in the Civil Court, within the local limits of whose original jurisdiction is situate the office in which the document is sought to be registered, a suit for a decree directing the document to be registered in such office if it be duly presented for registration within thirty days after the passing of such decree.

	Suit under Section 77	Suit for specific performance
Against whom	The Registrar who refused, and ordinarily the persons denying execution	The party who will not perform the contract
What is in issue	Was the document executed, and should it be registered	Is there a concluded contract, and is the plaintiff ready and willing
What the court decides	Nothing about title or the validity of the transaction	The enforceability of the contract
Limitation	Thirty days from the order of refusal, and Article 137 does not extend it; Section 5 of the Limitation Act has been held inapplicable to this period	Article 54: three years
The decree	Directs the document to be registered, and it must then be presented within thirty days	Directs execution of a conveyance, which must then be registered
Effect of registration that follows	Takes effect as if the document had been registered when first presented, Section 75(2)	The conveyance operates from its own date of execution, Section 47
Appeal	The ordinary appellate hierarchy under the Code of Civil Procedure	The same

⚠ The thirty day period under Section 77 is short and is strictly applied

A party whose document has been refused registration has thirty days from the order of refusal, and no more. The period is prescribed by the Registration Act itself, and the ordinary indulgence under Section 5 of the Limitation Act has not been treated as available for it. Where the thirty days are lost, the document cannot be registered through that route at all, and the party is thrown back on a suit for specific performance of the underlying contract, which is a different suit with different issues and a much heavier burden. The lesson is that a refusal must be acted upon at once.

5. Specific Performance After a Refusal of Registration

1. The two remedies are not alternatives in the ordinary case. Where the executant denies execution before the registering officer, the officer must refuse under Section 35(3), and the machinery of Sections 73 to 77 is the designed answer: an application to the Registrar, an enquiry into the fact of execution, and, on refusal, a suit under Section 77.

2. But where the thirty days have gone, or where the party wants relief that Section 77 cannot give, a suit for specific performance lies on the contract itself, and the unregistered document is admissible to prove that contract under the proviso to Section 49.

3. The issues differ, and so does what the plaintiff must show. Under Section 77 he need show only execution; in a specific performance suit he must show a concluded contract, readiness and willingness, and that the case is not within Sections 11(2), 14 or 16.

4. A decree under Section 77 relates back, because Section 75(2) makes the registration take effect as if the document had been registered when first presented. A conveyance executed under a decree for specific performance operates from its own date of execution under Section 47, which is ordinarily much later.

5. The relation back matters where a third party has intervened. A purchaser who bought between the first presentation and the eventual registration is in a very different position under the two routes.

6. Cancellation of a Registered Instrument

Sections 31 and 32, Specific Relief Act, 1963, in substance

31(1). Any person against whom a written instrument is void or voidable, and who has reasonable apprehension that such instrument, if left outstanding, may cause him serious injury, may sue to have it adjudged void or voidable; and the court may, in its discretion, so adjudge it and order it to be delivered up and cancelled.

31(2). If the instrument has been registered, the court shall also send a copy of its decree to the officer in whose office the instrument has been so registered; and such officer shall note on the copy of the instrument contained in his books the fact of its cancellation.

32. Where an instrument is evidence of different rights or different obligations, the court may, in a proper case, cancel it in part and allow it to stand for the residue.

The register is corrected only by the court, through the officer. The officer notes the cancellation; he does not adjudicate, and he cannot cancel on his own.
Section 33 requires restoration of benefits. On adjudging cancellation, the court may require the party to whom relief is granted to restore any benefit received under the instrument and to make such compensation as justice requires.
Limitation. Article 59 of the Limitation Act, 1963 gives three years from when the facts entitling the plaintiff to have the instrument cancelled first became known to him.
This is the only route. A Sub Registrar cannot cancel a registered document, Satya Pal Anand v. State of M.P., (2016) 10 SCC 767, and a transferor cannot cancel unilaterally, Thota Ganga Laxmi v. Government of Andhra Pradesh, (2010) 15 SCC 207.

7. Declaration of Invalidity

Section 34, Specific Relief Act, 1963

34. Discretion of court as to declaration of status or right. Any person entitled to any legal character, or to any right as to any property, may institute a suit against any person denying, or interested to deny, his title to such character or right, and the court may in its discretion make therein a declaration that he is so entitled, and the plaintiff need not in such suit ask for any further relief.

Proviso. Provided that no court shall make any such declaration where the plaintiff, being able to seek further relief than a mere declaration of title, omits to do so.

1. A declaration is the natural relief for a stranger to the deed. A person who never executed the instrument, and who claims a paramount title, does not need to have it set aside; he needs a declaration that his title subsists and that the instrument does not bind him.

2. Where the instrument is void, a declaration suffices. A forged deed is a nullity, and the plaintiff does not have to avoid what never existed.

3. Where it is voidable, a declaration will not do. The transfer is good until avoided, and the plaintiff must ask for cancellation under Section 31.

4. The proviso is a trap. Where the plaintiff is out of possession, he is able to seek the further relief of possession, and a suit for a bare declaration will be dismissed. Possession must be claimed as a consequential relief.

5. Limitation. Article 58 gives three years from when the right to sue first accrues, for a declaration; Article 59 governs a suit to set aside an instrument.

6. The court fee differs. A declaratory suit and a suit for cancellation are valued differently under the State court fees legislation, and getting it wrong delays the suit.

8. Rectification of a Registered Instrument

Section 26, Specific Relief Act, 1963, in substance

26(1). When, through fraud or a mutual mistake of the parties, a contract or other instrument in writing, not being the articles of association of a company, does not express their real intention, then (a) either party or his representative in interest may institute a suit to have the instrument rectified; or (b) the plaintiff may, in any suit in which any right arising under the instrument is in issue, claim in his pleading that the instrument be rectified; or (c) a defendant in any such suit may, in addition to any other defence open to him, ask for rectification of the instrument.

26(2). If, in any suit in which a contract or other instrument is sought to be rectified, the court finds that the instrument, through fraud or mistake, does not express the real intention of the parties, the court may, in its discretion, direct rectification of the instrument so as to express that intention, so far as this can be done without prejudice to rights acquired by third persons in good faith and for value.

26(4). No relief for the rectification of an instrument shall be granted to any party under this section unless it has been specifically claimed.

The mistake must be mutual, or there must be fraud. A unilateral mistake by one party, not induced by the other, is not a ground.
What is rectified is the instrument, not the bargain. The court corrects the writing so that it expresses what the parties actually agreed; it does not make a new agreement for them.
Rights of third persons acquired in good faith and for value are protected, which matters greatly where the instrument was registered and a purchaser searched the register and relied on it as it stood.
The relief must be specifically claimed, by sub section (4), and cannot be granted merely because the evidence would support it.
The rectified instrument should be registered. The decree directs rectification; the corrected instrument, or the decree, must find its way onto the record so that a later search discloses the true position. A decree of a court is itself exempt under Section 17(2)(vi), subject to the compromise exception.
Section 27 permits rescission, and Sections 29 and 30 allow alternative prayers, so a plaint may seek specific performance and, in the alternative, rescission, with compensation.

9. A Registered Instrument and an Injunction

1. A perpetual injunction is granted under Sections 37 to 42, and an interim injunction under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure.

2. An injunction acts on the person, and restrains him from doing something. It does not undo what has already been done.

3. So an injunction cannot cancel a registration already effected. A person who wants a registered deed undone must sue under Section 31; an injunction is not a substitute, and a prayer for one will not carry the relief he actually needs.

4. An injunction may restrain a threatened registration, where the plaintiff moves before the document is presented, and courts are cautious about granting it, because the registering officer has a statutory duty to register a document duly presented.

5. Section 41(h) bars an injunction where an equally efficacious relief can certainly be obtained by any other usual mode of proceeding, which is itself a reason why the proper relief against a registered instrument is cancellation and not injunction.

6. A suit for a bare injunction by a plaintiff whose title is itself in dispute is ordinarily not maintainable; he must sue for a declaration of title with consequential relief.

10. The Position Stated Shortly

1. The proviso to Section 49 allows an unregistered document to be read as evidence of a contract in a suit for specific performance, which is the bridge between a failed conveyance and a decree.

2. Since the amendment of 2018, specific performance is enforced as of course under Section 10, subject to Sections 11(2), 14 and 16, and readiness and willingness must be proved throughout.

3. A decree for specific performance does not transfer the property; it directs execution of a conveyance, which must itself be registered.

4. A suit under Section 77 is against the Registrar's order of refusal, is confined to the fact of execution, and must be brought within thirty days.

5. A suit for specific performance is against the party in default, turns on the contract, and is governed by Article 54.

6. Registration under a decree in a Section 77 suit relates back to the first presentation, Section 75(2); a conveyance under a specific performance decree operates from its own date of execution, Section 47.

7. Cancellation of a registered instrument lies only under Section 31, and the court sends a copy of the decree to the registering officer, who notes the cancellation.

8. A declaration under Section 34 is the relief for a stranger to the deed and for a void instrument; a voidable instrument must be set aside.

9. The proviso to Section 34 bars a bare declaration where the plaintiff could seek further relief, such as possession, and omits to do so.

10. Rectification under Section 26 requires fraud or mutual mistake, must be specifically claimed, and cannot prejudice third persons who acquired rights in good faith and for value.

11. An injunction restrains a person; it does not undo a registration already effected.