Foreign Desk/ APSnews/13/03/2020 A.D.
The case at hand came through an appeal from Trial Court where the admissibility of the Compromise deed was questioned. The Hon’ble High Court dismissed the writ by holding that the compromise deed needs to be registered. But the Hon’ble Supreme Court observed the exception given in the Registration Act and held that the compromise decree comprising immovable property other than that which is the subject-matter of the suit requires registration.
The Supreme Court in its judgment passed on 5th February, observed that a compromise decree does not require any registration if it does not take in property which is not the subject-matter of the case. The bench comprising of Justice Ashok Bhushan and Justice MD Shah observed that a conjoint reading of Section 17(1)(b) and Section 17(2)(vi) of the Registration Act, 1908 shows that compromise decree comprising the immovable property other than which is the subject-matter requires registration.
Prior facts
The appeal came in front for the Apex Court in this case after the Trial Court had allowed the objection of one of the plaintiffs. The plaintiff objected to the admissibility of a compromise decree, which was sought to be adduced as evidence in a matter relating to a plot of land, by the defendant on the ground that the said decree was not registered. The Trial Court observed that in view of Section 17 of the Registration Act, 1908 a decree is required to be registered, and as the decree is not registered in this case the same will not be admissible as evidence.
Challenging the said order, a writ petition was filed in the High Court. The High Court also dismissed the writ petition taking in the view that the decree was required to be registered. The High Court has its judgment relying on the precedent passed by the Supreme Court in Gurdwara Sahib v. Gram Panchayat Village Sirthala and Another, 1 SCC 669 (2014). Aggrieved by the order of the High Court the Appeal was filed in the Supreme Court. The issue before the Court was whether a compromise decree was required to be registered under Section 17 of the Registration Act, 1908.
Key Features
- A compromise decree passed by a Court would ordinarily come under Section 17(1)(b) of the Registration Act, 1908.
- 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 as a compromise and which is taking in a property other than that which is the subject-matter of the suit or proceeding.
- By virtue of Section 17(2)(vi) any decree or order of a court does not require registration.
- A decree or order which is expressed as a compromise and which takes in property other than one which is the subject-matter of the suit or proceeding requires registration.
The SCs take
The bench of Justice Ashok Bhushan and Justice MD Shah referring to the provisions of the Registration Act, 1908 observed that, a compromise decree passed by a court would be covered by Section 17(1)(b) of the act. But Sub-section 2 of Section 17 provides for an exception for any decree or order passed by 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.
Thus the Court by virtue of the said provision, i.e. Section 17(2)(vi), observed that any decree or order of a Court does not require registration. In Sub-clause (vi) only one category is excepted, 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. Therefore, by reading conjointly both the Sections, i.e. Section 17(1)(b) and Section 17(2)(vi) of the act, it would be clear that a compromise decree comprising immovable property other than that which is the subject-matter of the suit requires registration, although by virtue of Section 17(2)(vi) any decree or order of a Court is exempted from registration.
In view of the above, the Apex Court came to the conclusion that, since the compromise decree passed by the Court for the property, which was the subject-matter of the suit, the exclusionary clause of Section 17(2)(vi) would not be applicable. The Court said that the compromise decree dated 04-10-1985, by a plain reading of Section 17(2)(vi), was not required to be registered. The Apex Court also referred to its judgment in Som Dev and Others v. Rati Ram, 10 SCC 788 (2006), which held that all decree and order of the Court including compromise decree, subject to the exception referred above, do not require registration.
Foreign Desk/APSNews
