Home > Recent Judgements > No Title Transfer Without Registration: Sc Rejects Tenant’s Claim
Sept 19, 2024
NO TITLE TRANSFER WITHOUT REGISTRATION: SC REJECTS TENANT’S CLAIM
The Supreme Court’s decision in the case of Beena and Ors. Vs. Charan Das & Ors., centres on the principle that no transfer of title in immovable property is legally effective without a registered instrument, as stipulated by the Transfer of Property Act, 1882. The Court overturned the High Court’s ruling, which had erroneously interpreted a settlement agreement as conferring ownership rights upon the respondent based on a deposit made to avoid eviction. The Supreme Court reaffirmed that settlements or consent orders in the absence of a registered conveyance deed do not effectuate a transfer of property title. This judgment emphasizes the necessity of adhering to statutory requirements and formalities in property transactions to ensure valid and clear title transfers.
FACTUAL BACKGROUND
The case revolves around an eviction suit filed by the appellant against the respondent due to the deteriorating condition of the property. During the proceedings, a settlement was reached where the respondent was required to deposit ₹12,000/- to dismiss the eviction application. Failure to deposit the amount would result in eviction. The respondent deposited the amount and claimed ownership of the property, arguing that the settlement implied a transfer of title. The trial court and the first appellate court rejected this claim but the High Court reversed the decision, leading to the appellant’s appeal to the Supreme Court.
ISSUES
- Did the settlement and the deposit of the stipulated amount confer ownership of the property upon the respondent?
- Is a transfer of title legally tenable without a registered instrument or document?
SUPREME COURT’S HOLDING
The Supreme Court overturned the High Court’s judgment, ruling that no transfer of title could occur without a registered document, thereby rejecting the respondent’s ownership claim. The Court held that the settlement agreement was purely procedural, addressing only the eviction application based on the deposit or non-deposit of the stipulated amount, without implying any transfer of ownership. Emphasizing the statutory requirement under the Transfer of Property Act, the Court noted the absence of a registered instrument, rendering the respondent’s claim legally untenable. Additionally, the ₹12,000/- deposited by the respondent was not considered sale consideration but merely a sum agreed upon to resolve the eviction suit with no bearing on ownership rights. The Supreme Court criticized the High Court’s erroneous interpretation of the settlement and consent order, which were procedural and did not pertain to a transfer of ownership, particularly in the absence of a registered instrument or any document evidencing a transfer of title.
LEGAL PRINCIPLE ESTABLISHED
The Supreme Court reinforced the principle that no transfer of title in immovable property is possible without a registered instrument as mandated by the Transfer of Property Act. Settlements or consent orders, without a registered conveyance deed cannot be construed as instruments of title transfer.
KEY INSIGHTS
By setting aside the High Court’s ruling and upholding the trial and first appellate courts’ findings, the Supreme Court underscored the necessity of adhering to statutory formalities in transactions involving immovable property. The judgment reaffirms that ownership cannot be claimed or conferred based solely on informal settlements or oral agreements, without the execution of a duly registered document. Accordingly, the respondent’s claim to ownership was rejected and the appeal was allowed in favour of the appellant.
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