2019 (12) TMI 1640 - HC - Indian Laws

Refusal to register a settlement deed - refusal on the ground that the subject property had been agreed to be sold in favour of the second respondent by an agreement of sale - HELD THAT - The unenforceability of the agreement cannot be decided by the first respondent. Given the present circumstances the only remedy for the petitioner is to seek for a declaratory relief by filing a suit before the competent Civil Court stating that the registered agreement of sale is a nullity and is unenforceable and that therefore it should be set aside. There cannot be any difficulty to present a plaint to declare the agreement of sale as unenforceable because the cause of action for doing so has arisen only now when the petitioner executed a gift deed in favour of her granddaughter. The writ petition is disposed of by granting liberty to the petitioner to approach the competent Civil Court to declare the agreement of sale as null and void and unenforceable. If such a plaint is presented the competent Civil Court is directed to entertain the suit and take a decision on merits and in accordance with law.

Summary

Issues:
Challenge to refusal to register settlement deed based on prior agreement of sale.

Analysis:
The petitioner contested a check slip issued by the first respondent, refusing to register a settlement deed due to a prior agreement of sale with the second respondent. The court noted that as per current rules, the first respondent cannot be compelled to register the settlement deed unless the registered agreement of sale is legally canceled. The petitioner argued that the agreement of sale from 2006 had expired, and the second respondent had not shown readiness to perform, rendering the agreement unenforceable. The court agreed with the petitioner's legal stance, stating that the unenforceability of the agreement should be determined by a civil court through a declaratory suit.

The petitioner expressed concern that a civil suit might be rejected on grounds of limitation. However, the court clarified that there should be no issue in filing a suit now, as the cause of action to declare the agreement unenforceable arose when the petitioner executed a gift deed to her granddaughter. Consequently, the writ petition was disposed of, granting the petitioner liberty to approach the competent Civil Court to seek a declaration that the agreement of sale is null and void. The court directed the Civil Court to entertain the suit, make a decision based on merits and law, and if successful, allow the petitioner to register the gift deed with the first respondent based on the court's judgment and decree. No costs were awarded in this matter.