Merely Signing Sale Deed But Denying Its Execution Is A Valid Ground To Refuse Registration – Supreme Court

In this context, the Court opined –

"…in a situation where an individual admits their signature on a document but denies its execution, the Sub-Registrar is bound to refuse registration in accordance with Sections 35(3)(a) of the Registration Act."

The Court also held that the execution of a document does not stand admitted merely because a person admits to having signed the document.

Senior Counsel Mr Pradeep Kant appeared for the Appellant while Senior Counsel Mr VK Shukla appeared for the Second Respondent before the Apex Court.

In this case, a sale deed was presented for registration before the Sub-Registrar, however, upon presentation, the Appellant submitted an objection in writing with a request not to execute the incomplete and forged sale deed in favour of the Second Respondent.

The Appellant had contended before the Sub-Registrar that the Second Respondent was harassing her into forcibly signing the sale deed in respect of her property. It was further argued that the Second Respondent had furnished her with misleading and false information in order to get her to sign the papers.

It was further alleged that the Second Respondent had manipulated the actual area of the land by also including the Appellant's house.

Thereafter, the Sub-Registrar declined to register the sale deed, which led to the Second Respondent instituting an appeal under Section 72 of the Registration Act. The Appellant objected to the maintainability of the appeal under Section 72 on the ground that the sale deed in dispute was not executed by her.

The District Registrar while entertaining the appeal proceeded to follow the procedure under Section 74 of the Act to determine whether the sale deed was executed by the Appellant. It was held by the Registrar that the Appellant had admitted her signature on the document and that the Second Respondent was entitled to get the sale deed registered. Consequently, the sale deed was registered.

Aggrieved with the order of the District Registrar, the Appellant filed a Writ Petition before the Allahabad High Court, which came to be dismissed.

Aggrieved, the Appellant approached the Supreme Court.

The two issues which were dealt with by the Court were –

i) Whether the recourse by the second respondent to Section 72 of the Registration Act, against the order of the Sub-Registrar refusing registration on the basis of the appellant's denial of execution, would deprive them of any remedy whatsoever; and

ii) Whether the appellant's admission of her signatures and thumb impressions/fingerprints on the sale deed also amounts to an admission of its ―execution

• First Issue

The Apex Court noted that the order of the Sub-Registrar makes it abundantly clear that the Appellant was not ready to register a sale deed, which was claimed to have been executed in a fraudulent manner and whose execution was thus denied. Registration was therefore denied by the Sub-Registrar under Section 35(3)(a) of the Registration Act.

Further, the Bench held that a refusal to register a document under Section 35(3)(a) of the Act, the order was amenable to appeal under Section 72 of the Registration Act.

*Section 72 of the Act states that an appeal will lie against an order of Sub-Registrar refusing to admit a document to registration ―except where the refusal is made on the ground of denial of execution. *

Furthermore, the Court noted that the Registrar in the course of entertaining an appeal instead took recourse to the powers entrusted to it under Section 73 of the Act.

* Section 73 empowers the Registrar where the Sub-Registrar has refused to register a document on denial of its execution by a person purporting to have executed. *

In this context, the Court observed –

"Thus, while the Sub-Registrar under Section 35(3)(a) has to mandatorily refuse registration when the execution of a document is denied by the person purported to have executed the document, the Registrar is entrusted with the power to conduct an enquiry on an application under Section 73 by following the procedure under Section 74."

The Court in this regard referred to Mulla's commentary on the Registration Act where it analyses a situation where an application under Section 73 of the Act is wrongly labelled as an appeal under Section 72. It was held –

―If a refusal is made on the ground of denial of execution, an appeal would not lie under s 72 of the Act. When the refusal is denied on the execution, the remedy is to file an application under s 73 of the Act. The mere fact that an application is wrongly headed as an appeal and an erroneous section of the statute is mentioned therein is immaterial, if in fact and in law it is an application under s 73 of the Registration Act.

Thus, the Court held that mislabelling of an application under Section 73 as an appeal under Section 72 would by itself not vitiate the proceedings before the Registrar, when the proceedings before the Registrar in substance were proceedings under Section 73 itself and both the parties acknowledged them to be so, explicitly or by their conduct.

The Court hence observed –

"Therefore, we hold that the second respondent's mis-labelling of their application as an appeal under Section 72 will not vitiate the proceedings which led to the District Registrar's order dated 31 March 2012."

• Second Issue

The Court placed reliance in various precedents and observed that the execution of a document does not stand admitted merely because a person admits to having signed the document. In this context, the Court noted –

"…Such an interpretation accounts for circumstances where an individual signs a blank paper and it is later converted into a different document, or when an individual is made to sign a document without fully understanding its contents. Adopting a contrary interpretation would unfairly put the burden upon the person denying execution to challenge the registration before a civil court or a writ court, since registration will have to be allowed once the signature has been admitted."

The Court also held that if the interpretation conflating signing with execution is adopted, it would ensure that the Sub-Registrars/Registrars will continuously end up registering documents whose validity will inevitably be then disputed in a Civil Suit or Writ Petition, the Court thus noted –

"While the suit or writ proceedings continue, the document would remain on the public records as a registered instrument, which has the potential to cause more disruption. Hence, such an interpretation should not be adopted by this Court."

"…in a situation where an individual admits their signature on a document but denies its execution, the Sub-Registrar is bound to refuse registration in accordance with Sections 35(3)(a) of the Registration Act. Subsequently, if an application if filed under Section 73, the Registrar is entrusted with the power of conducting an enquiry of a quasi-judicial nature under Section 74. If the Registrar passes an order refusing registration under Section 76, the party presenting the document for registration has the remedy of filing a civil suit under Section 77 of the Registration Act, where a competent civil court will be able to adjudicate upon the question of fact conclusively," the Court additionally opined.

In the light of these observations, the Court allowed the appeal and set aside the impugned order of the Single Judge of the High Court.

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