• Unregistered sale agreement - by previous owner

We are from chennai and close to 70 families have purchased residential plots in 2014 from a seller M/s XYZ. We have done the sale deed and received 
the patta with clear title and the layout is CMDA approved . In the Year 2016 we received a court notice for case filed
by M/s ABC . M/s ABC claims that they had entered into a unregistered sale agreement with M/s ABC in the year and have paid 
a sum of 2.5 Cr .This transaction is also not getting reflected in EC as it is unregistered.
They have claimed for specific performance of the unregistered sale agreement and requested the courts to declare out titles on the plots "null and void".

We have through an advocate filed a rejection petition in the case.

1. What is the likely hood that his case can affect out title on the plots?
2. What are the implications on "we the buyers" due to this unregistered sale deed.

Recently it has come to our notice that there is an other case ( on the same issue )between ABC & XYZ from the year 2016 which is active and is filed in different district court ,
we the buyers have not been made party to this case .

3. Will a ruling on this case have any impact on our original case .Should we also be party to this 
case ?
Asked 6 years ago in Property Law
Religion: Hindu

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12 Answers

1. See if there is agreement and the XYZ has breached the contract then court can pass an order in favour of ABC .

2. In case the sale agreement specific performance is passed then you have remedy to recover the amount from XYZ.

3. No they are two different civil suits. You don't need to be party in other suit as you are not purchasers there.

Shubham Jhajharia
Advocate, Ahmedabad
25513 Answers
179 Consultations

1) has court passed any interim orders .?

 

2) you don’t have clear and marketable title to property 

 

3) you must take out intervenor application to be added as party to the case 

 

4) in the vent sale is set aside your remedy is against seller to recover your money with interest 

Ajay Sethi
Advocate, Mumbai
99787 Answers
8146 Consultations

Dear client, 

Specific performance of unregistered agreement is permitted.

What is the date of agreement ?

Separate cases on same cause of action not maintainable, one have to be stayed.

Number of effected buyers are many, don't worry for any adverse orders effecting buyers title, Recovery shall be from builder otherwise jail and higher court will stay any action against buyers.

Sale deeds registered or not, If not than only recovery from builder by filling separate suit / complain.

Yogendra Singh Rajawat
Advocate, Jaipur
23082 Answers
31 Consultations

If any interim relief is given to him that can affect your case. It depends on the discretion of the judge and merits of the case. You need to challenge any unfavorable order in appeal.

Prashant Nayak
Advocate, Mumbai
34522 Answers
249 Consultations

I wonder why didn't you pose these questions to your counsel?

If you are interested to talk my number is available in google .

Regards 

G.Rajaganapathy 

Rajaganapathy Ganesan
Advocate, Chennai
2300 Answers
8 Consultations

1. Have you purchased the property by a registered sale deed, then the subsequent sale agreement made in the year 2016 is not valid and maintainable. 

2. If you have not been made a party to that suit you may file a petition to implead you as a necessary party to that suit and challenge it properly. 

3. Yes,  don't lose the chance 

T Kalaiselvan
Advocate, Vellore
89989 Answers
2493 Consultations

Other case may be for some other cause of action.

Suit is barred by limitation.

Yogendra Singh Rajawat
Advocate, Jaipur
23082 Answers
31 Consultations

What were the clause of un registered sale agreement 

 

2) un registered agreement for sale is admissible in evidence 

 

3) how has builder explained period of 10 years in filing suit for specific performance 

 

4) was time essence of contract?

 

5) necessary to peruse all documents cited by you to advice 

Ajay Sethi
Advocate, Mumbai
99787 Answers
8146 Consultations

1. Yes unregistered agreement is proof of transaction and agreement between Them

2. Court may cancel the sale alternatively since ABC also didn't take step for many years court can order the owner to refund money of ABC with interest.

3. You people can claim to be bonefide purchasers as no registered agreement , no entry was there to suspect the sale and you people took due care to purchase the property.

Shubham Jhajharia
Advocate, Ahmedabad
25513 Answers
179 Consultations

1.  The unregistered sale agreement can be used as evidence for the money paid by the buyer to the seller, that too if it is within three years from the date of receipt of the said sale consideration amount

Hence you may not worry much about it, you can follow it up through your advocate regularly so that you dont miss any important event in the court.

 

2.  When the worst scenario occurs, you will find alternate solutions also o tackle them, hence you may just wait for the time to answer to the solve the present crisis

T Kalaiselvan
Advocate, Vellore
89989 Answers
2493 Consultations

It will be in your favour of Properly conducted through a learned advocate. As many families future is dependent on this case it will be considered by the court speedily

Prashant Nayak
Advocate, Mumbai
34522 Answers
249 Consultations

  1. As per the information mentioned in the present query, makes it clear that though the POA was revoked, but the actions taken prior to the revocation will remain in force.
  2. And there has been a law that sale deed must be a registered one to prove as evidence before the court of law as per the registration act.
  3. Unregistered sale deed will/ shall not be produced before the court of law as per law irrespective of the fact that it is now a valid transaction, if it starts admitted then no one would go for its registration and revenue department of state would lose a handsome amount of revenue in the form of the stamp duty.
  4. I have never come across any case law where it has been upheld that unregistered sale deed can be relied upon to prove the whole title/ question of the suit.
  5. It is clear that the unregistered document can be received as evidence only to substantiate the plea of part-performance of a contract whether it can be a contract of sale or lease or mortgage. The document can be looked into only insofar as it serves as evidence of the part performance of a contract. So also, it can be received as evidence of collateral transaction not required to be effected by registered instrument. If the transaction is such that it requires to be registered in order to give effect to the same, the document cannot be relied upon to prove the transaction as such. In the S.R. Taramma case (supra) decision our High Court held that unregistered saledeed can be admitted in evidence for the purpose of proving possession in a suit for perpetual injunction restraining the defendant from interfering with the possession of the plaintiff. In the Ummadi Subramanyam case (supra) decision our High Court held that unregistered sale deed can be received in evidence in a suit filed for specific performance provided it is impounded by the Court or the Collector under Section 33 of the Stamp Act.

Sanjay Baniwal
Advocate, South Delhi
5477 Answers
13 Consultations

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