"Unregistered Mortgage Deed Invalid: Chhattisgarh High Court Upholds Trial Court’s Judgment in Property Dispute"

In a significant ruling, the Chhattisgarh High Court, presided over by Justice Narendra Kumar Vyas, reaffirmed the importance of legal formalities in property transactions. The court, on March 14th, 2024, dismissed the First Appeal No. 171 of 2017, filed under Section 96 of the Code of Civil Procedure, 1908, by appellant Hetram Sahu, challenging the trial court's decision that declared a mortgage deed null and void.

The dispute centered around a property transaction dating back to September 20, 2006, between Hetram Sahu (appellant/defendant No.1) and Ramlal Chouhan (plaintiff/respondent). The plaintiff accused the defendant of deceitfully executing a mortgage deed instead of a rent agreement. This deed came to the plaintiff's notice only in 2012 during a proceeding under Section 145 of the Cr.P.C.

Justice Vyas, in his judgment, emphasized the legal requirements for a valid mortgage, stating, "It is a mortgage by conditional sale. The issue with regard to mortgage has recently come up for consideration before the Hon'ble Supreme Court in Civil Appeal No 706 of 2015 decided on 18-8-2023 in case of Prakash (dead) by LR vs. G. Aradhya and others." The court found the mortgage deed in question to be a conditional sale, which did not fulfill the necessary conditions outlined in Section 58(c) of the Transfer of Property Act.

Furthermore, the judgment highlighted the importance of registration under the Registration Act, 1908, for properties valued over Rs. 100. "If the sale property is more than Rs. 100/- then it should be registered document," the court observed, underscoring the invalidity of the unregistered mortgage deed in this case.

The court dismissed the appeal, affirming the trial court's decision in favor of Ramlal Chouhan and highlighting the necessity of registration for the legitimacy of property transactions. This judgment serves as a crucial reminder of the legal intricacies in property dealings and the consequences of neglecting procedural compliance.

Date of Decision: 14-03-2024 

HETRAM SAHU Vs. RAMLAL CHOUHAN AND OTHER