Supreme Court Holds Unregistered Agreement to Sell Admissible as Evidence in Suit for Specific Performance

In a recent judgment, the Supreme Court of India ruled that an unregistered Agreement to Sell can be admitted as evidence in a suit for specific performance. The decision came in the case of R. Hemalatha v. Kashturi, in which the appellant challenged the High Court's order allowing the respondent's revision application.

The dispute arose from a civil suit filed by the respondent for specific performance of an Agreement to Sell dated September 10, 2013. The trial court had held that the unregistered agreement was inadmissible as evidence, citing the Tamil Nadu Amendment Act No.29 of 2012, which made the registration of agreements for the sale of immovable property valued at Rs.100/- and above compulsory.

The appellant argued that the agreement could not be admitted as evidence due to its non-registration. However, the High Court relied on the proviso to Section 49 of the Registration Act, which allows unregistered documents affecting immovable property, required to be registered, to be received as evidence in a suit for specific performance.

Analyzing the provisions of the Registration Act, the Supreme Court observed that the proviso to Section 49 permits the admission of unregistered documents in certain circumstances. Noting that the unregistered agreement fell within the ambit of this proviso, the Court upheld the High Court's decision, stating that it correctly applied the law.

The judgment emphasized that the Tamil Nadu Amendment Act of 2012, which made the registration of agreements compulsory, did not include a corresponding amendment to Section 49 of the Registration Act. Therefore, the Court held that the unregistered agreement could be accepted as evidence in a suit for specific performance.

Date of Decision: April 10, 2023

HEMALATHA     vs KASHTHURI