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Padmakan Singh Vs. Third Joint Sub Registrar, Coimbatore and ors. - Court Judgment

LegalCrystal Citation
SubjectProperty
CourtChennai High Court
Decided On
Case NumberWrit Petn Nos. 799 and 912 of 1963
Judge
Reported inAIR1967Mad482; [1967]63ITR679(Mad)
ActsPayment of Taxes (Transfer of Property) Act, 1949 - Sections 2 and 3; Indian Registration Act - Sections 34, 35, 58, 59, 60, 61 and 87
AppellantPadmakan Singh
RespondentThird Joint Sub Registrar, Coimbatore and ors.
Cases ReferredR. v. Metropolition Police Commissioner
Excerpt:
.....and that, the registering officer was not in possession of any declaration as such made by the income tax officer, nor was there any demand for arrears of tax from the mortgagor and that any subsequent declaration made after the registration would not make the registration of the document void and illegal, and that even otherwise the bank has nothing to do either with the declaration of the title to the property in as much as they have advanced money on the security of the property in the presence of the sub registrar. section 35 provides that, when the registering officer has satisfied himself that a document has been executed by the persons purporting to execute it, he 'shall register the document as directed in sections 58 to 61 inclusive' registration, therefore, consists of the..........him under s.2(ii) of the payment of taxes (transfer of property) act, (act xxii of 1949) from the income tax officer, and directed her to produce a certificate under s 3 of that act. the district registrar also stated that the document in question had not yet been admitted to registration.(4) the mortgagor has stated that she is person permanently residing in india and does not propose to leave india, that as far as she is concerned she has no hesitation to pay whatever amount is due and payable by her to the income tax department by way of tax, presumably meaning thereby that she is not responsible or liable to pay the amount of tax due and payable by her husband.(5) according to the mortgagor, on 15-5-1963 there was no declaration, such as that provided in s.2 (ii) of the payment of.....
Judgment:
ORDER

(1) These two writ petitions are filed by the mortgagor and the mortgagee respectively, for the issue of a writ of mandamus to deliver to them the deed of simple mortgage executed by the mortgagor (Padmakan Singh) in favour of the mortgagee (the Coimbatore Vasanthara Bank Ltd.) and registered on 15-5-1963.

(2) The circumstances that led to the filing of the writ petitions are these Smt. Padmakan Singh, the petitioner in W.P. 799 of 1963 is a permanent resident of Coimbatore. She owns the property No. 17/73 Oppanakara Street, Coimbatore. Her husband is carrying on business at Coimbatore and is assessed to income tax she applied to the Coimbatore Vasunthara Bank Ltd., for a loan of Rs. 50,000 on the mortgage of her house mentioned above. As she did not desire to attend the office of the Registering officer, she wrote a letter on 15-5-1963 requesting the officer, the Third Joint Sub-Registrar, Coimbatore, to go over to her residence, for the purpose of registering the document, on payment of the necessary fees. The Sub-Registrar came to her residence on 15-5-1963. The Sub-Registrar showed her a letter, in which it was alleged that the income tax assessment proceedings against her husband were pending, that the property which she held in her name was really benami for him, and that no document dealing with the said property should be registered. Nevertheless the Sub-Registrar proceeded with the registration of the document. The mortgagor admitted the execution of the document. The particulars were endorsed. The money payable to the mortgagor was paid by the mortgagee's agent, in the presence of the Sub-Registrar, and an endorsement to that effect was also made on the document. The registering officer also affixed his signature and date to the document. Afterwards, the Sub-Registrar took the document, in order to copy the contents of the document in book No. 1 and the document was given the number P. 20/63 in book No.1 but there is no word 'registered'.

(3) Thereafter the Sub Registrar addressed a letter on 16-5-1963 to the District Registrar, Coimbatore, seeking his instructions, in view of the letter received by him from the income tax authorities, before taking further proceedings for the completion of the registration of the document. The District Registrar directed the Sub-Registrar not to complete registration of the document unless the mortgagor produced a certificate to the effect that she had paid all the income tax, presumably due and payable by her husband. The District Registrar Coimbatore, also wrote a letter to the mortgagor on 12-7-1963 that a declaration had been received by him under S.2(ii) of the Payment of Taxes (Transfer of Property) Act, (Act XXII of 1949) from the Income tax officer, and directed her to produce a certificate under S 3 of that Act. The District Registrar also stated that the document in question had not yet been admitted to registration.

(4) The mortgagor has stated that she is person permanently residing in India and does not propose to leave India, that as far as she is concerned she has no hesitation to pay whatever amount is due and payable by her to the Income Tax Department by way of tax, presumably meaning thereby that she is not responsible or liable to pay the amount of tax due and payable by her husband.

(5) According to the mortgagor, on 15-5-1963 there was no declaration, such as that provided in S.2 (ii) of the Payment of Taxes (Transfer of Property) Act, which prevented the registration of the document and, inasmuch as having accepted the document and having complied with all the formalities under the Registration Act, there was no choice left with the Registering officer except to comply with the other formalities under the Act and deliver the document.

(6) As far as the mortgagee Bank is concerned, their contention is that they have no knowledge of any claim of tax due and payable by the mortgagor, that the title to the property is in the name of the mortgagor, having been purchased in her name on 8-2-1960 ad that the registering officer cannot therefore raise any question of title in the form of benami in these proceedings. They also contend that the declaration as mentioned in the Payment of Taxes (Transfer of Property) Act, made by the Income-tax department was received by the registering officer after the date of registration, and that on the date of registration there was no declaration as contemplated in Section 2(ii) of the Act, and further the provisions relating to transactions of immovable property to defraud the revenue have nothing to do with the present transaction nor with the registration of the document. The Bank also contends that the Sub-Registrar has failed to discharge the statutory duty imposed on him by the Act, that he has no discretion in the matter and no question of admitting or not admitting the document for registration arises in the present case, and that, the registering officer was not in possession of any declaration as such made by the Income tax Officer, nor was there any demand for arrears of tax from the mortgagor and that any subsequent declaration made after the registration would not make the registration of the document void and illegal, and that even otherwise the Bank has nothing to do either with the declaration of the title to the property in as much as they have advanced money on the security of the property in the presence of the Sub Registrar.

(7) The contention of the Income-tax Officer seems to be that his enquiry revealed that the property belongs to the husband of the mortgagor and that the mortgagor is only a benamidar and that she has no title to the property. Her husband owes large amount of tax to the department in respect of his business, and assessment proceedings are pending and the department has taken the precaution, long before the date of registration, by informing the registering officer not to register any document purporting to effect any transfer of the house belonging to the mortgagor. All the correspondence that passed between the Income-tax Officer and the registering officer should be taken and read together and, in the context, be regarded as relative declaration under Section 2(ii) of the Act. Even otherwise, the process of registration is not complete without the endorsement 'registered' on the instrument, and, before that step could be taken, the registering officer has been lawfully prohibited by a valid declaration under Section 2(ii) of the Payment of Taxes (Transfer of Property) Act 1949.

(8) The contention of the registering officers is that they are within their jurisdiction in withholding registration of the document. They contend that the document has only been accepted for registration but not actually registered.

(9) On a perusal of the pleadings, the important question that arises for consideration is, when a document can be said to be registered; in other words, what are the requirements necessary for the completion of the registration of a document.

(10) In Veerappa Chetti v. Kadiresan Chetti : (1913)24MLJ664 a Division Bench of this Court, after posing the question what is the meaning of the word 'registered' proceeds to observe thus--

'The statute refers to various stages which have to be completed before a document becomes registered instrument. Section 35 provides that, when the registering officer has satisfied himself that a document has been executed by the persons purporting to execute it, he 'shall register the document as directed in Sections 58 to 61 inclusive' Registration, therefore, consists of the acts mentioned in Sections 58 to 61 Section 60 provides that the officer should endorse a certificate containing the word 'registered' together with the number and page of the book in which the document has been copied after the provisions of Sections 34, 35, 58 and 59 have been complied with and he is then to sign, seal and date the certificate. The section proceeds to say that 'the registration of the document shall thereupon be deemed complete'.

In the present case, all the formalities have been completed by the Sub Registrar, except compliance of the provisions mentioned in Sections 60 and 61, namely, the endorsement of the certificate 'registered' and then copying into the margin of the Register book. The point for consideration is whether the mere omission to endorse the word 'registered' would affect the registration of a document.

(11) The whole object of the Registration Act is to guard against fabrication of documents of title from time to time, and the real purpose of registration is to check forgery and to provide good evidence of the genuineness of the written documents. Registration mainly required for the purpose of giving notoriety to the deed and to provide a guarantee of the genuineness of the instrument. The evidence of registration is itself some evidence of execution against the person by whom it purports to be executed. The certificate of registration is some evidence of execution against the party making admission. It is true that a certificate of registration is evidence that a document was duly registered. It gives the document the character of a registered document. The certificate though it may be indicative and afford proof of due registration, does not by itself affect registration. The endorsement to be made by the Sub Registrar under Section 60 is only a relevant evidence of proving facts mentioned in the endorsement. The certificate of registration endorsed on a document, though prima facie, evidence that the document has been duly registered, is not conclusive evidence of valid registration. The mere omission of the endorsement of registration is not a defect fatal to the validity of registration of the instrument.

(12) There is a conflict of opinion among High Court in India, as to what is the effect of non-compliance of the provisions mentioned in Sections 60 and 61 of the Registration Act. In the earlier case on the subject, Sitanath Bandopadhya v. Bissessur Roy Chaudhuri, 6 CWN 528, the learned Judges of the Calcutta High Court observed that the sealing of a deed was not an essential part of the act of registration, and that the omission of the registering officer to seal a deed was a mere defect of procedure, and the defect was cured by the provisions of Section 87 of the Registration Act. In Sobhnath Singh v. Pirthipal Singh, , the Sub-Registrar came to the residence, the document was presented to him, the deed was properly executed and attested and the necessary formalities of registration were gone through and the provisions of Sections 34, 35, 58 and 59 were complied with Thereafter, the Sub Registrar issued the usual receipt under Section 52 and kept the document for being copied in Register No.1 and for endorsing the final certificate of registration as required by Section 60(1). While so, the document was snatched away from the custody of the registering officer. The question was whether the deed executed operated to effect the transfer of the properties covered by it. The Chief Court of Oudh observed that it was the compliance with the provisions of Sections 34, 35, 58 and 59 which constituted registration of a document and not the presence of the certificate under Section 60 of the Act that the subsequent formalities were mere ministerial acts and that the defects occasioned therein by the acts or carrying out the duties enjoined by Ss. 60 and 61 would merely constitute defects of procedure for which neither the donor nor the donee was responsible. In Kishangopal v. Nathulal, AIR 1956 Madh Bha 236 a Division Bench of the then Madhya Bharat High Court observed that, where a document was registered by a Registrar after complying with the provisions of Sections 58 and 59, but he failed to make an endorsement as required by Section 60, the defect was a defect of procedure, which did not render the registration invalid, by reason of Section 87 of the Registration Act.

(13) But, in Mt. Domini Kuer v. Ramsaranlal, : AIR1957Pat545 , a Division bench of the Patna High Court observed, after dealing with the provisions contained in Secs. 34, 35, 52, 58 and 61 of the Indian Registration Act, thus:

'From the above provisions of the Act, therefore, we gather that the registration of a document is deemed to be complete under Section 61(2) of the Act, only when the document has been copied into the margin of the Register book as required by Section 61(1) of the Act. From the above scheme of the Act, therefore, there is no doubt that the registration of the document shall be deemed to be complete only when it is copied, and not otherwise'.

(14) In Sharnappa v. Pathru Saheb, AIR 1963 Mys 335, there was compliance with the provisions of Sections 34, 35, 52, 58 and 59 but not with the provisions of Sections 60 and 61 of the Registration Act. A Division Bench of the Mysore High Court observed that the non-compliance with the provisions of Ss. 60 and 61 could not be said to be merely defect in procedure but was a total violation of the provisions or requirements of the Act which made the registration of the document incomplete.

(15) In the two decisions cited above, it is not stated as to what would be the effect of such a document, whether it would invalidate the whole transaction and whether the document becomes void by reason of non-compliance with the provisions of Sections 60 and 61 of the Act. Under the circumstances, I would prefer to follow the opinion expressed by the Calcutta, Oudh and Madhya Bharat High Courts, as the reasoning there appears to me to be logical and reasonable. In the instant case, only the word 'registered' was not endorsed on the instrument. The contents of the document have been copied and a number has also been given to the document. And the Sub Registrar would have endorsed on the document 'registered' as required by Section 60(1) of the Act. But for the intervention of the Income-tax Authorities, directing him not to register the document. The registering officer has no jurisdiction to refuse registration of a document, and, as observed by their Lordships of the Privy Council in Kalyanasundaram v. Karuppa .

'Registration is the act of an officer appointed by law for the purpose, who if the deed is executed by or on behalf of the donor and is attested by at least two witnesses, must register it if it is presented by a person having the necessary interest within the prescribed period'.

In this case, the Income-tax Authorities intervened in the course of the transaction directing the Sub-Registrar not to register the document, on the ground that the property was purchased benami in the name of the mortgagor and that the mortgagor's husband owed a large amount of tax and that he had not been given a clearance certificate. It is to be remembered that the document in question was presented to the Sub Registrar by the mortgagor at her residence on 15-5-1963. Just then, the Sub Registrar produced a Demi-official letter, said to have been addressed to him, in which it was alleged that income-tax assessment proceedings against the mortgagor's husband were pending, that the property in question was really benami for him and that no document dealing with the said property should be registered. But the District Registrar has, in his affidavit, stated that, as the parties insisted upon the acceptance of the document for registration, the Joint Sub-Registrar, on the instructions of the District Registrar, attended at the private residence of the petitioner(mortgagor) on 15-5-1963, accepted the document, recorded her admission of execution and the payment of the mortgage money on the document and kept it pending without registration, as a doubt was felt on the point whether the document could be registered or not, in view of the communication of the Income-tax Officer dated 15-12-1962.

(16) It is, therefore, necessary to say, somewhat in detail, the part played by the Income-tax authorities, in this matter of registration. The income-tax authorities got information that the husband of the mortgagor, in view of the pressure of the impending back assessments against him, was likely to leave India for good and settle elsewhere disposing of the house in Coimbatore. Therefore, by their letters dated 14-12-1962 and 15-12-1962, the authorities requested the Sub-Registrar not to register any document executed by Sippy (husband of the mortgagor) or wife (mortgagor) or both for transferring the ownership of the building. The whole tenor of both these letters seems to be a sort of warning to the Joint Sub-Registrar Coimbatore, dated 20-12-1962, wherein it is stated that suitable action will be taken if and when the document in question is presented for registration. Nothing happened afterwards till 15-5-1963, when the document was presented for registration. On 15-5-1963, in spite of the warnings received from the Income-tax Authorities, the Sub Registrar, on the advice of the District Registrar, proceeded in the matter of the registration of the document. Then on 18-5-1963, the District Registrar addressed a letter to the Income-tax Officer, Coimbatore, asking him whether there was any statutory provision requiring a registering officer to refuse registration of any document presented by a person, against whom a requisition has been received from the Income-tax Officer to refuse registration On 27-5-1963, for the first time, in reply to the letter of the District Registrar, the Income-tax Officer, Coimbatore, referred to the provisions of the Payment of Taxes (Transfer of Property) Act, 1949, and stated that that letter might be treated as a declaration issued by him under Section 2(ii) of the said Act. Therefore, for the first time the declaration was made only on 27-5-1963. By that time, the document had already been executed by the mortgagor in favour of the mortgagee (bank), the execution of the document was duly attested, consideration passed, the Sub Registrar made an endorsement on the back of the document, a receipt also was passed, the document was taken by the registering officer to his office for being copied and a number was also given to the document (P 20 of 1963 Book I). The word 'registered' was not endorsed. As this is only a ministerial act and the omission to do it is only a procedural defect, the omission to make the endorsement would not invalidate the registration. I do not also think that the income-tax authorities can question the transaction as one made after the registering officer received the declaration.

(17) But the learned counsel for the Income-tax Department would contend that the letters dated 14-12-1962 and 15-12-1962 should be treated as declaration under Section 2(ii) of the Payment of Taxes (Transfer of Property) Act, 1949. If so read, they are certainly before 15-5-1963, the date of registration of the document.

(18) Under Section 3 of the Payment of Taxes (Transfer of Property Act, 1949 no registering officer can register any document purporting to transfer or assign any right, title or interest in any property, unless it is certified by the Income-tax Officer of the area in which the property is situate in respect of the person whose right, title or interest in the property is to be re-transferred or assigned that such a person is not liable to assessment or taxation, that such person has either paid or made satisfactory provision for the payment of all existing or anticipated liabilities and that the Income-tax Officer is otherwise satisfied that the registration of the document will not prejudicially affect the recovery of such liabilities. This statutory declaration prohibits any transfer of immovable property belonging to income-tax assesses. When property rights are involved, and when such rights are affected by such declaration, it should and must specify in great detail how those transactions are to be prohibited under the Act. It is absolutely necessary and essential that the legal authority and the jurisdiction under which it has to be exercised should be mentioned. It is also necessary to assert the provision of law and to give a short and simple statement of the case. The letters dated 14-12-1962 and 15-12-1962 are all in the nature of warning in general terms given to the registering officer not to register any document purporting to effect a transfer of the property, as otherwise it would be difficult for them to collect the taxes due from the mortgagor's husband. That was the reason why the District Registrar addressed a letter on 18-5-1963 to the Income-tax Officer to inform him of the provision of law requiring the registering officer to refuse registration in such contingencies. It is clear, therefore, that the letters dated 14-12-1962 and 15-12-1962, are not statutory declarations as required by Section 2(ii) of the relevant Act.

(19) Further, the mortgagor is not the person concerned in the controversy. She is not stated to be in arrears of tax to the department. Assessment proceedings are pending against her husband. The property mortgaged in favour of the Bank is her property. The Department now asserts that the property is held benami. The burden of proof is upon the department. And this is neither the occasion nor the place for the registering officer either to consider or to decide whether the property really belongs to the mortgagor. When the mortgagor requested the registering officer to return the document after complying with the provisions of Sections 60 and 61 of the Registration Act, it was then that she was informed that there was a statutory declaration prohibiting him from registering the document, on the ground that her husband was in arrears of tax, and advised her letter dated 25-7-1963 to the Income-tax Officer that she had no valid visa with her, nor had she applied to the Reserve Bank for the transfer of any of her assets and that she was ready and willing to pay any amount that might be found due from her It can, therefore, be seen that the Income-tax Authorities are only trying to seize this opportunity, to collect the tax due from her husband. But I do not think they can succeed. Certainly, the letters dated 14-12-1962 and 15-12-1962, can never be called or termed declaration as required by the Statute. It is settled law that in a statutory declaration, all the requirements of the section should and must be strictly complied with literally Otherwise, it may prove to be fatal to the action proposed to be taken, especially in a case where property rights are involved. I am convinced that, on the date of the registration of the document, namely 15-5-1963, there was no statutory declaration prohibiting the registering officer from completing the registration.

(20) It is next contended that a writ of Mandamus cannot issue, because this Court cannot go into or question the opinion formed by the Income-tax Authorities that the mortgagor's husband was likely to leave India without settling the income-tax due to the department. I am not going into that question in these proceedings. The mortgagor and the mortgagee are only seeking the return of the document which was registered on 15-5-1963. All the formalities mentioned in Sections 34, 35, 58 and 59 of the Registration Act have been complied with. The endorsement 'registered' is the only thing to be done. The registering officer is a public officer, and the petitioners want this Court to direct him to carry out the duty which has been imposed on him by the statute. He is refusing to exercise the jurisdiction of the returning the document to the proper party. Lord Goddard C.J. observed in R. v. Metropolition Police Commissioner; Ex parte, Parker, 1953 1 WLR 1150--

'Mandamus will lie to any person who is under a duty imposed by statute or by the common law to do a particular act, and if a person refrains from doing the act or refrains from wrong motives from exercising a power which it is his duty to exercise, this Court will by order of Mandamus tell him to do it. Mandamus may go to individuals. It may go to corporations and goes quite independently of whether the individual or body to which it is addressed is or is not a Court'.

(21) Under the circumstances, the rule is made absolute. The petitions are allowed No costs.


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