By Dr Sanjay Chaturvedi, LLB, PhD
The Indian Registration Act
Another Act which is very important in matter of real estate is the Indian Registration Act. The said Act provides for the law relating to registration of document. The very important section is Section 17 of the said Act. Part III of the said Act governs the law of registrable document. Section 17 of the said Act reads as under :
“17. Documents of which registration is compulsory. (1) 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 :-
- Instruments of gift of immovable property;
- 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;
- 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 interests; and
- Lease of immovable property from year to year, or for any term exceeding one year, or reserving a yearly rent
- 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 subsection 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.
- Nothing in clauses (b) and (c) of subsection (1) applies to –
- any composition-deed; or
- 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
- any debenture by any such Company and not creating, declaring, assigning, limiting or extinguishing any right, title or interest, to or 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
- any endorsement upon or transfer of any debenture issued by any such Company; or
- any document 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
- 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
- any grant of immovable property by the Government; or
- any instrument of partition made by a Revenue Officer; or
- any order granting a loan or instrument of collateral security granted under the Land Improvement Act, 1871, or the Land Improvement Loans Act, 1883; or
- any order granting a loan under the Agriculturists Loans Act, 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
- 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
- any certificate of sale granted to the purchaser of any property sold by public auction by a Civil or Revenue
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.
(2) Authorities to adopt a son, executed after the first day of January 1872, and not conferred by a will, shall also be registered.
Five categories of documents are compulsorily required to be registered which are described in Section 17(I)(a), (b), (c), (d) and (e). One important aspect to be remembered is that the instrument of gift of immovable property irrespective of the value, even if it is less than Rs.100/-, such gift requires to be registered under the said Section. Another aspect which is to be borne in mind that all the documents described therein are non-testamentary instrument,
i.e. instrument or document executed and be effective during the lifetime of a person. Testamentary documents like Will, Codicil are not required to be registered even if under the Will the immovable properties given whose value may be more than lakhs of rupees. Clauses (b) and (c) cover large number of documents because any interest which is created, declared, assigned, limit extinguished whether in the present or future or any right, title or interest – whether vested or contingent – in case of immovable property of the value of Rs.100/- and above needs to be registered. You would have noticed that there is no reference of registration of document of any movable property. Whereas Section 17(2) gives exceptions of documents which need not be registered even if they fall within Section 17(1)(a) to (e). Some of the important exceptions are in grant of immovable property by government. It must be noted that Agreement for Sale does not required to be registered under the Registration
Act as it does not create, declare, assign, limit or extinguish any right, title or interest of any immovable property which merely creates a right to obtain conveyance which will, when executed, create, declare, assign, limit or extinguish any such right, title or interest. In view of Section 17(2)(v), an Agreement for Sale does not require to be registered under the said Registration Act. One thing should be borne in mind that Section 17 prescribes law as to documents which are required to be compulsorily registered. Any document which does not fall within Section 17(1) can be registered, but it is optional. Another thing which should be borne in mind is that only any document or instrument can be registered.
If there is no writing with signature, then the same cannot be registered.
The Law as to effect of document which is required to be compulsorily registered and not registered is governed by Section 49 of the said Act. The said Section reads as under :- “49. Effect of nonregistration of documents required to be registered. No document required by section 17 (or by any provision of the Transfer of Property Act, 1882) to be registered shall –
- affect any immovable property comprised therein, or
- confer any power to adopt, or
- be received as evidence of any transaction affecting such property or conferring such power, unless it has been
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.”
We are vitally concerned with first part, i.e. if any document required to be registered under Section 17 of the said Act or any provisions of Transfer of property Act, then it cannot affect any immovable property comprising therein. In other words, conveyance, deed of gift if it is not registered then the property transfer is invalid. Therefore such document if required to be compulsorily registered and even if it is executed but not registered it will not affect the immovable property or the rights therein. The transferee or purchaser will not get any rights in the said property.
Transfer of Property Act provides that certain documents need to be registered. If such documents are not registered, then under Section 49 they will not affect any immovable property comprised in the said document.
Section 4 of the Maharashtra Ownership Flats (Regulation and Promotion of Construction, Sale, Management & Transfer) Act, 1963 provide that Agreement for sale of flat need to be registered. Therefore, registration of the said document is necessary but the same is not required to be registered under the Registration Act or the Transfer of Property Act. Therefore, the provisions of Section 49 of the Indian Registration Act will not apply to such an Agreement for Sale even if it is not registered.
Such documents are required to be registered with the Sub Registrar of Assurances appointed under the Indian Registration Act within whose jurisdiction the said immovable property is situated. However, in case of Mumbai, Kolkata, Chennai and Delhi, the documents of any parts of India can be registered with the Sub Registrar of the said Cities.
The fees prescribed to be paid for registration of document is 1 per cent of the consideration and the maximum registration payable for any instrument is Rs.20,000/- in the State of Maharashtra.