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LEGAL CHAT

The most significant legal consequence is that there is universal “notice” to such title in the hands of the transferees which will receive complete and absolute recognition from the general public.

The nature and scope of such “notice” has been clearly defined in Explanations to Section 3 of the Transfer of Property Act, 1882, and the same are highlighted below:

It deals with a transaction relating to immovable property effected through the registration of a compulsorily registrable instrument.

It clearly states that any other person acquiring such property or any part thereof or share or interest in the same shall be deemed to have notice of the aforesaid instrument from the date of the registration of the same.

Where the immovable property covered by the instrument is situated within the territorial jurisdiction of more than one sub-registrar, then, the memorandum of such instrument registered with one sub-registrar should be filed with the other sub-registrar in whose jurisdiction a part of such immovable property is situated.

Once a memorandum is so filed with the other sub-registrar, then there is deemed to be notice of such memorandum and through such memorandum there is notice to the main instrument to all persons dealing with such part of the property situated within the jurisdiction of the other sub-registrar.

Such a memorandum will be duly entered in the appropriate registers and books maintained by the other sub-registrar.

This is an important provision dealing with immovable property of huge sizes and dimensions which come under the territorial jurisdiction of different sub-registrars and it emphasises the absolute legal necessity of preparing a memorandum of the original instrument and having the same duly filed and entered into the statutory books and registers of the other sub-registrars.

Explanation to the aforesaid Section 3 further specifies that any person dealing with such property shall be deemed to have notice about the actual possession thereof of any person or persons having title to such property.

Another Explanation makes it clear that when an authorised agent acquires notice of the aforesaid transaction and interest, the agent’s principal also is deemed to have notice of the same.

However, it is also clearly provided that when an agent fraudulently conceals the fact of his having such notice from the principal, with the knowledge and connivance of another person, then the principal shall not be deemed to have notice as against the other person who has knowledge and who connives with the agent in such fraudulent concealment.

Non-registration angle

A transaction dealing with rights and interests in immovable properties of a value of Rs.100 and more is carried out through following legal processes and documentation.

First, there is an agreement to transfer such rights and interests duly executed by the transferor and the transferee.

The second stage is that the agreement is acted upon and the actual deed of transfer duly stamped is executed by the parties and duly attested by witnesses.

The next step is that the deed so executed is presented for registration before the appropriate registration authorities within the prescribed period ie., four months from the date of execution of the deed. The final step to be carried out by the parties is to appear before the registration authorities personally or through their authorised representatives and formally admit execution of the document by each one of them.

The registration authority then accepts the document, makes a verification as to whether the statutory compliances have been made and then formally register the document through due attestation and endorsement and through entries being made about them in the appropriate statutory registers and books maintained for the purpose under the law.

However, there can be defaults, delays and violations made by parties at each one of the aforesaid stages, due to which the registration of the document does not take place at all.

The legal effects and consequences of such defaults and violations at each one of the aforesaid stages resulting in non-registration and the legal reliefs and remedies available to the aggrieved parties against the offending parties in respect of such violations and defaults are discussed in the next and subsequent issues.

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