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Gupta Agro Venture Pvt. Ltd. v/s Pratap Singh & Another

    First Appeal No. 70 of 2008

    Decided On, 08 March 2021

    At, High Court of Uttarakhand

    By, THE HONOURABLE MR. JUSTICE SHARAD KUMAR SHARMA

    For the Appellant: S.K. Mandal, Advocate. For the Respondents: V.D. Bisen, Advocate.



Judgment Text

1. This is a plaintiff’s First Appeal, which has been preferred by the appellant by invoking the provisions contained under Section 96 of the C.P.C., for the purposes of challenging the judgment and decree dated 8th September, 2008, which was rendered by the Court of Civil Judge (Senior Division), Udham Singh Nagar, in Original Suit No. 85 of 2006, Gupta Agro Ventures Pvt. Ltd. Vs. Pratap Singh and others. By virtue of the impugned judgment and decree, which is under challenge in the present First Appeal, the learned Trial Court had dismissed the Suit, consequently, the present First Appeal.

2. Brief facts, which are required to be considered in the First Appeal, in question, are that admittedly, the defendant/respondents, herein, were the bhumidhars of the piece of an agricultural land, which was lying in Khata No. 00142, Khasra No. 710, having an area of 1.326 hectares, i.e. equivalent to 3.28 acres of land in Village Shimla Pitore, Tehsil Kichha, District Udham Singh Nagar.

3. The aforesaid defendants/respondents are said to have, on 31st December, 2005, entered into an unregistered notorized agreement for sale, which was executed in favour of one Mr.Surendra Kumar Gupta S/o Badri Prasad Gupta, Director, Gupta Agro Ventures Pvt. Ltd..

4.As per the covenants of the said agreement for sale, though unregistered, the sale deed was agreed to be executed, as in relation to the property, the description of which was more particularly given in para7ofthe agreement for sale, but since, the same was not executed as agreed, as such, the plaintiff/appellant, herein, on 28thApril, 2006, is shown to have instituted a Suit for the grant of decree of permanent injunction, as against the defendants/respondents, in relation to the property as described above, and a declaration was also sought to the effect that the plaintiff, happens to be the owner of the property and they have also sought a decree for specific performance of the said unregistered agreement for sale, which was executed between them on 31stDecember, 2005.

5.Asper the plaint averments, which was not instituted by the parties to the agreement for sale, but rather by M/s Gupta Agro Ventures Pvt. Ltd., which was altogether a distinct legal entity and a juristic person. In the plaint averments, it was contended that when despite of having parted of with the partial sale consideration as agreed, when the sale deed was not executed by 31stMarch, 2006, as it was an agreed date, as per the terms of the agreement, the notices were issued and when despite of the service of notice, when the same was not executed, it was contended that on 19thApril, 2006, the plaintiff acquired the rights and a cause of action a rose for him to file the Suit for the aforesaid relief for the grant of decree of permanent injunction and for specific performance.

6.The defendants/respondents were noticed, and in pursuance to the notice, which were issued to them, they have filed their written statement on 24thMay,2006,denying the plaint averments and particularly, a specific plea has been taken in para 13 and 22 of the written statement with regard to the amendment which were carried in the provisions, contained under Section 154 of the U.P. Z.A. & L.R. Act, imposing the restrictions, upon conveying the agricultural property, which has been recorded as an agricultural land and, particularly, with regard to the fact and from the perspective that an unregistered agreement for sale of an immovable property, the registration of which, was mandatory as per the terms of Section 17 of the Registration Act, no right and title could be conferred on the appellant nor there was any cause for him to institute the Suit, because of the embargo created under Section 45 (e) (i) (j) of the Specific Performance Act. Later on, the plaint was amended for altogether a different reason the Suit itself, which have no any relevance for the purposes of deciding the present First Appeal.

7. Before the learned Trial Court, after the exchange of the pleadings, the learned Trial Court had framed the issues to the following effect:-

“LANGUAGE”

8. In support of his contention, the plaintiff/appellant has adduced his both documentary and oral evidence and had appeared in the witness box as PW1, and deposed in support of his case, besides placing on record the documents by way of list 8-Ga to 9 and list 85 Ga.

9. On the contrary, the defendants/respondents too appeared in the witness box and had recoded their statement as DW1 and DW2, as well as an additional statement of DW3, i.e. Halka Patwari, in support of their contention.

10. The learned Trial Court of Civil Judge (Senior Division), Rudrapur, District Udham Singh Nagar, while considering the respective evidence and judicial precedence which was relied by the parties, while deciding the issue No.1, had observed that though the execution of the agreement for sale dated 31st December, 2005, stood proved by evidence to have been executed, but then the question pertaining to the sustainability of the Suit for specific performance, based on the said unregistered agreement for sale, the registration of which is otherwise mandatory under Section 17 of the Registration Act, was decided by way of issue No.4, against the plaintiff, holding thereof that such type of agreements, which are unregistered, apart from the fact that, it cannot be read in evidence, as no right could be conferred by way of an unregistered agreement for sale, as per Section 54 of Transfer of Property Act, particularly, when it relates to an immovable property and further as per the Registration Act itself, the Suit would not be maintainable for the specific performance.

11. It has been argued by the learned counsel for the appellant that though there happens to be an embargo of sustaining or maintaining a Suit for specific performance, based on an unregistered agreement for sale, which is though mandatory, but still once the fact of its execution has been admitted, in that eventuality, the agreement could be read for all other collateral purposes, i.e. for the exchange of the partial consideration, which has changed hands between the parties to the agreement as a consequence of the execution of the agreement for sale. Hence, he submits that the impact of registration ought to have been considered by the Trial Court, in the light of the finding which had been recorded on issue No.1, particularly, when the fact of execution of an agreement for sale has been admitted.

12. This Court while considering this First Appeal, after hearing the counsel for the parties, formulates the following points of determination in the light of the provisions contained under Order 41 Rule 31 of the CPC :-

i. That looking to the unregistered agreement itself, whether it was executable by invoking a civil proceedings for specific performance ?

ii. Whether at all the suit for specific performance could be instituted on the basis of the unregistered agreement for sale ?

iii. As to whether the agreement for sale dated 31st December, 2005, would be read for collateral purposes for the purpose of return of money of partial sale consideration, which has been shown to have been paid, as per the terms of the agreement for sale ?

13. Section 17 of the Registration Act reads as under:

“17. Documents of which registration is compulsory.—(l) The following documents shall be registered, if the property to which they relate is situate in a district in which, and if they have been executed on or after the date on which, Act No. XVI of 1864, or the Indian Registration Act, 1866, or the Indian Registration Act, 1871, or the Indian Registration Act, 1877, or this Act came or comes into force, namely:—

(a) instruments of gift of immovable property;

(b) other non-testamentary instruments which purport or operate to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property;

(c) non-testamentary instruments which acknowledge the receipt or payment of any consideration on account of the creation, declaration, assignment, limitation or extinction of any such right, title or interest; and

(d) leases of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent;

[(e) non-testamentary instruments transferring or assigning any decree or order of a Court or any award when such decree or order or award purports or operates to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees and upwards, to or in immovable property:]

Provided that the State Government may, by order published in the Official Gazette, exempt, from the operation of this sub-section any lease executed in any district, or part of a district, the terms granted by which do not exceed five years and the annual rents reserved by which do not exceed fifty rupees.

[(1-A) The documents containing contracts to transfer for consideration, any immovable property for the purpose of section 53A of the Transfer of Property Act, 1882 (4 of 1882) shall be registered if they have been executed on or after the commencement of the Registration and Other Related laws (Amendment) Act, 2001 and if such documents are not registered on or after such commencement, then, they shall have no effect for the purposes of the said section 53A.]

(2) Nothing in clauses (b) and (c) of sub-section (l) applies to—

(i) any composition deed; or

(ii) any instrument relating to shares in a joint stock Company, notwithstanding that the assets of such Company consist in whole or in part of immovable property; or

(iii) any debenture issued by any such Company and not creating, declaring, assigning, limiting or extinguishing any right, title or interest, to or in immovable property except in so far as it entitles the holder to the security afforded by a registered instrument whereby the Company has mortgaged, conveyed or otherwise transferred the whole or part of its immovable property or any interest therein to trustees upon trust for the benefit of the holders of such debentures; or

(iv) any endorsement upon or transfer of any debenture issued by any such Company; or

(v) any document [other than the documents specified in sub-section (1A)] not itself creating, declaring, assigning, limiting or extinguishing any right, title or interest of the value of one hundred rupees and upwards to or in immovable property, but merely creating a right to obtain another document which will, when executed, create, declare, assign, limit or extinguish any such right, title or interest; or

(vi) 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]; or

(vii) any grant of immovable property by the Government; or

(viii) any instrument of partition made by a Revenue-Officer; or

(ix) any order granting a loan or instrument of collateral security granted under the Land Improvement Act, 1871 (26 of 1871), or the Land Improvement Loans Act, 1883 (19 of 1983); or

(x) any order granting a loan under the Agriculturists Loans Act, 1884 (12 of 1884) or instrument for securing the repayment of a loan made under that Act; or

[(xa) any order made under the Charitable Endowments Act, 1890, (6 of 1890) vesting any property in a Treasurer of Charitable Endowments or divesting any such Treasurer of any property; or]

(xi) any endorsement on a mortgage-deed acknowledging the payment of the whole or any part of the mortgage-money, and any other receipt for payment of money due under a mortgage when the receipt does not purport to extinguish the mortgage; or

(xii) any certificate of sale granted to the purchaser of any property sold by public auction by a Civil or Revenue-Officer.

[Explanation.—A document purporting or operating to effect a contract for the sale of immovable property shall not be deemed to require or ever to have required registration by reason only of the fact that such document contains a recital of the payment of any earnest money or of the whole or any part of the purchase money.]

(3) Authorities to adopt a son, executed after the 1st day of January, 1872, and not conferred by a will, shall also be registered.

14. Section 17 of the Registration Act, has specifically made it mandatory, that no agreement for sale or transfer of a title or a document, which has been included therein, could be made and taken into consideration and read in evidence for enforcement of a civil right, which is not otherwise registered as per the provisions under Registration Act, and the effect of its non registration in itself would bar the institution of the Civil Suit for its specific performance, and as per the provision contained under Section 49 of the Registration Act, no Suit for specific performance could have been instituted in relation to an unregistered agreement for sale dated 31st December, 2005, and hence, the first point stands determined as against the plaintiff /appellant, herein.

15. The second aspect pertaining to the reading of the unregistered agreement for sale for collateral purposes, if the inter se binding effect of the agreement for sale dated 31st December, 2005, is taken into consideration, the signatories to the agreement were described as under:-

“LANGUAGE”

16. In fact, the terms of agreement for sale, if at all had any binding effect or could have been read for collateral purposes, it could have been qua the defendants and Mr. Surendra Kumar, and not the appellant, because apparently as per the agreement for sale has not shown the appellant as to be the proposed purchaser of the property under it. The logic behind it is that the status of Gupta Agro Venture Pvt. Ltd., is altogether a different and distinct juristic person and the alleged agreement for sale proposing to purchase the property, as described above, the said Pvt. Ltd. Company was not the proposed purchaser, but rather, it was Mr. Surendra Kumar Gupta, who had rather in his individual capacity, who has described himself as to be the Director of the appellant, had entered into an agreement for sale, and if at all there was any cause of action to institute the Suit for specific performance and the grant of decree of permanent injunction, it would have been at the behest of Mr. Surender Kumar Gupta, in his individual capacity, and not by the present appellant, who is not the signatory to the agreement. Hence, this agreement for sale, even as per th

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e concept argued by the learned counsel for the appellant that it could be read for collateral purposes, it could be only between the signatories to the agreement and not to the appellant, who is not signatory to it. 17. The plaintiff/appellant, as far as they are concerned and, particularly, in the set of circumstances of the present case, and that too in the light of the provisions contained under Section 54–A of the Transfer of Property Act, to be read with Section 49, the plaintiff/appellant had no cause of action to file a Suit for specific performance, though it might not have been maintainable at their behest in the light of the fact that the agreement for sale was not registered by them, and hence, the point of determination as formulated above is answered against the plaintiff/appellant, as I hereby hold that as far as the plaintiff/appellant in the capacity of the Pvt. Ltd. Company is concerned, which has got its separate legal entity and is an independent juristic person, as per the provisions of the Companies Act, has got its individual right to sue or to be sued and its cause has not been represented in the agreement for sale in the said status of being a company, which was sought to be enforced by the Suit for specific performance. 18. Consequently, the Appeal lacks merit and the same is dismissed. The judgment and decree as rendered by the learned Court of Civil Judge (Senior Division), Udham Singh Nagar, in Suit No. 85 of 2006, M/s Gupta Agro Ventures Pvt. Ltd. Vs. Pratap Singh, dismissing the Suit by the impugned judgment dated 8th September, 2008, is hereby confirmed. Accordingly, the decree is directed to be formulated.
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