G RAMACHAR vs. THE STATE OF KARNATAKA

-: 1 :- IN THE HIGH COURT OF KARNATAKA, BENGALURU DATED THIS THE 18TH DAY OF MARCH, 2016 PRESENT THE HON'BLE MR.SUBHRO KAMAL MUKHERJEE, CHIEF JUSTICE AND THE HON'BLE MRS. JUSTICE B.V.NAGARATHNA

WRIT PETITION No.18939/2009 (GM-ST-RN-PIL) c/w WRIT PETITION No.14050/2012 (GM-ST-RN-PIL)

IN W.P.No.18939/2009

BETWEEN:

... PETITIONERS

-: 2 :- (BY SRI: JAYAKUMAR S.PATIL, SENIOR ADVOCATE FOR V.K. NARAYANA SWAMY, ADVOCATE)

AND:

... RESPONDENTS

(BY SRI: M.I. ARUN, ADDITIONAL GOVERNMENT ADVOCATE)

*****

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA, PRAYING TO QUASH THE IMPUGNED CIRCULAR DT. 6TH APRIL 2009, AT ANX-A ISSUED BY THE R1, AS ILLEGAL AND UNENFORCEABLE AND ETC.

IN W.P.No.14050/2012 BETWEEN:

-: 3 :- AGED ABOUT 39 YEARS, R/AT NO.586, HESARAGHATTA, BANGALORE NORTH TALUK, BANGALORE.

... PETITIONERS

(BY SRI: M.S. BHAGWAT, ADVOCATE)

AND:

... RESPONDENTS

-: 4 :- (BY SRI: M.I. ARUN, ADDITIONAL GOVERNMENT ADVOCATE)

*****

THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA, PRAYING TO CALL FOR THE RECORDS FROM THE RESPONDENTS PERTAINING TO THE IMPUGNED LETTER DTD.3.4.12 ISSUED BY THE R2 VIDE ANNEX-A AND THE CONSEQUENT CIRCULAR DTD.3.4.12 ISSUED BY THE R3 VIDE ANNEX-B AND ETC.

THE JUDGMENT IN THESE PETITIONS HAVING BEEN RESERVED ON 11/09/2015 AND IT BEING LISTED FOR PRONOUNCEMENT TODAY, NAGARATHNA J., PRONOUNCED THE FOLLOWING:

O R D E R

These writ petitions are filed in public interest. We have delinked Writ Petition Nos.7834-7835/2013 from these writ petitions, as those writ petitions are not public interest litigation. Hence, they would be heard separately. In essence, they challenge Circular bearing No.KAME.344.MUNONU/2008 dated 06/04/2009, as being illegal and contrary to law.

-: 5 :- They have also sought a direction to the authorities in-charge of registration of documents, restraining them not to apply Circular dated 06/04/2009 at the time of registration of documents.

-: 6 :- shall refuse to register any document to which a notification issued under sub-section (1) is applicable.

-: 7 :- and void. The subsequent Circulars issued under the strength of Section 22A of the Act are also contrary to the dictum of the Hon’ble Supreme Court in the aforesaid case. Therefore, petitioners have sought a declaration to the effect that Section 22A of the Act, Circular dated 06/04/2009 and all subsequent Circulars and Notifications issued pursuant thereto are null and void. In the above context various other circulars and letters/communications issued by the respondent-authorities.

-: 8 :- register only those transactions, which are permissible in law. The impugned circular lists certain transactions the documentation of which cannot be registered as they violate various provisions of Central and State laws. Those laws are Section 21(1) and (4) of the Registration Act; Sections 28, 34 and 45 A of the Karnataka Stamp Act, 1957; Rule 3 of Karnataka Stamps (Prevention of Undervaluation of Documents) Rules, 1977; Section 131 (c) of the Karnataka Land Revenue Act, 1964 read with Rule 46(H) of Karnataka Land Revenue Rules and Section 81-A of the Karnataka Land Revenue Act, 1964; Section 6 of the Karnataka Scheduled Caste and Scheduled Tribe (Prohibition of Transfer of Certain Lands) Act, 1978; Section 8 of the Karnataka Land (Restriction on Transfer) Act, 1991; Rule 114(c) sub-rule (2) Paras (a) and (h) of Income-tax Rules, 1962; Section 192 A, B and C of Karnataka Land Revenue Act, 1964.

-: 9 :- 5. The impugned Circular is therefore, to be enforced in order to prohibit certain transactions from being registered as they violate the aforesaid laws. The Circular is a guideline to the Sub Registrars throughout the State, who could prevent illegal transactions being registered. Therefore, it is contended that the Circular dated 06/04/2009 is in accordance with law and there is no merit in the writ petition.

-: 10 :- 7. We have considered these cases in the context of challenge to Circular dated 06/04/2009.

“22A. Documents registration of which is opposed to public policy.-(1)The State Government may, by notification in the official Gazette, declare that the registration of any document or class of documents is opposed to public policy.

(2)Notwithstanding anything contained in this Act, the registering officer shall refuse to register any document to which a notification issued under sub-section (1) is applicable.”

The said section is in pari materia with Section 22A incorporated by the Legislature of State of Rajasthan to the Act. The impugned Circular dated

-: 11 :- 06/04/2009 is issued pursuant to Section 22A of the Act, English translation of which reads as under:-

“Translated copy: (From Kannada to English) (Symbol) KARNATAKA STATE GEZETTE:

Authorized Publication Special Edition: ---------------------------------------------------------------- Part-I Bangalore, Monday, May, 4th 2009 No.272:

(Vaishakha 14, Sakal Era 1931) --------------------------------------------------------------- REVENUE SECRETARIAT: CIRCULAR:

No.RD/Mu.No.Mu./2008 BANGALORE: Dated 6th April, 2009.

Sub:- Guidelines in connection to registration of documents including the transfers of immoveable properties in accordance with the State and Central Acts in respect to the registration of document.

-----

The Karnataka State was prohibited the registration of the documents against to the public policy brought amendment through including the provisions of Sec.22-A to the Registration Act, 1908. The said amendment is made as invalid in the case of Rajasthana State V/s. Basanth Nahata reported in AIR 2005 S.C. 3402 passed the judgment by Hon’ble Supreme Court; but certain

-: 12 :- provisions of State and Central laws has given empower to obtain certain document and certificates for stopping the violation of provisions of said Laws and revenue leakage etc. given right to Registering Officials who assigned under provisions of Registration Act, 1908.

Even also in view to maintain the rights and liabilities of public in connection to registration of documents and also to maintain the Work Police of Government, the Registering Officers are being held responsible to prevent in obtaining certain documents and certificates for the purpose to stop the violation of the provisions of said laws.

Certain provisions of State / Central laws holding an effect on the registration of documents:- 1) Sec. 21(1) and (4) of Registration Act {explanation as necessary to identify the property; and to issue its map or plan (sketch)}

2) Section-28, 34 and 45-A of Karnataka Stamps Act 1957; read with Rule-3 of Karnataka Stamps (prevention of devaluation of documents) Rules, 1977 (to enter the correct market price of the said property);

-: 13 :- 3) Section-131(C) of Karnataka Land Revenue Act, 1964; read with Rule-46(H) of Karnataka Land Revenue Rules, (to issue survey sketch or land survey map as per prescribed Form-11-E);

4) Sec. 81-A of Karnataka Land Reforms Act, 1961 (to declare in the prescribed format by the purchaser as they are agriculturists and having no excess land and further declare that they are not exceeded their annual income of non-agriculture for Rs.2-00);

5) Sec.6 of Karnataka Scheduled Caste / Scheduled Tribes (PTCL) Act, 1978; (to be made as land in not involving to the prohibition alienation/registration);

6) Section-8 of Karnataka Land (prohibition of alienation) Act, 1991 (To be made as the land in not involving to prohibition of alienation/registration);

7) Clause-(A) to (H) of Sub-Rule (2) of Rule- 114(c) of Income Tax Rules, 1962: (To issue PAN Card Number allotted from the competent authority of Income Tax Department or to declare as per Form No.60 and 61, in case if the value of the property is

-: 14 :- come to Rs.5-00 lakhs or more than that; in respect of transfer of property as per sale) 8) Sec.192A, 192B and 192C of Karnataka Land Revenue (Amendment) Act, 2007; (To be made as the land in not involving to prohibition of alienation i.e. for non agricultural purpose of agricultural land and without Government land).

The amendment is brought to the Karnataka Land Revenue Act, 2007, in making transfer of agricultural land into non-agricultural purpose unauthorisedly / for wrongful utilization / illegally, to prevent the cases in making unauthorized transfer of Government lands; and for providing the provisions to impose the fine/punishment on the persons who made violation of law in this connection.

By transferring the properties illegally in the Bangalore City and other Cities in the State are going the way to inregulated and uncontrolled developments. So, due to the such type of transfer of properties illegally, the public cannot be holdings of legal and good marketable title deeds on their properties; and even also the innocent-Purchasers will be suffered by involving into such disputes and unnecessary transactions in this regard. Especially some of the mediators and land-swailowers having

-: 15 :- got General Power of Attorney from the property owners and will be made an agreement of sale in respect of said properties to the purchaser/s or written G.P.A. in his favour; and such persons are selling the properties without giving legal and absolute title-deeds etc., which is observed by the Government, in this regard.

Therefore, it is necessary of urgency in framing guidelines required to be followed for bringing the clarity in this regard. Hence a direction has been issued to similar type of guidelines or instructions along with the consent of Law Department to prevent the provisions of Act/violation of such provisions of Law, in view of Judgments rendered by the Hon’ble High Court of Karnataka and Hon’ble Supreme Court; and also to fix the documents as required to get at the time of registering the documents due to prevent the opposition and violation of the provisions of Law as mentioned above; and also for the purpose of guidance of public who are coming for registration of documents under the directions issued to the Inspector General of Registration and Commissioner of Stamps and also to the Government in this regard under Order No.KIC/1267/2008 Dated 5-6-2008 issued by the Hon’ble Karnataka Information Commission.

-: 16 :- Therefore in view of public convenience and to implement the State Policy effectively, the Registering Officer/Sub-Registrar shall take the documents as enclosed in Annexure-I under the facts and circumstances at the time of producing the documents for registration. It is explained in the Annexure-III in respect of action required to be taken in following the same from Revenue Officers, Registering Officer i.e., Sub-Registrars and Competent Authority at the time of registering such documents.

In continuation of the same, the Secretary of Grama Panchayath, Chief Executive Officer of Taluka Panchayath/TMC/CMC; and Commissioner of City Corporations etc., are held responsible for taking suitable action, by conducting verification of such documents or in such cases if violated any Act/Rules coming their Jurisdiction in respect of the documents received by them, after over the such above-registration. And the concerned Officers have to maintain Check-Register compulsorily as specified in Annexure-IV for conducting such verification in these cases from time to time in this regard. At the occasion of providing such documents for registration, if the party does not produce any one of the document as specified in Annexure-I; and thereafter the Registering Officers/Sub-Registrars are required to give notice

-: 17 :- or to inform suitably in this regard; by issuing an Endorsement as specified in Annexure-V.

It is hereby clarified that the concerned Officers should be followed all these points without fail; and also disciplinary action will be taken very strictly against the Officers who failed to implementing the guidelines as specified in this Circular sufficiently in this regard.

Sd/-

(G.S.Narayana Swamy)

Secretary to Government;

Revenue Department;

(Peril Maintenance)

//True Translated Copy//”

-: 18 :- registration offices in the territories under the State Government, and shall have power from time to time to make rules consistent with this Act –

(a) providing for the safe custody of books, papers and documents;

(aa) providing the manner in which and the safeguards subject to which the books may be kept in computer floppies or diskettes or in any other electronic form under sub-section (1) of section 16A;

(b) declaring what language shall be deemed to be commonly used in each district;

(c) declaring what territorial divisions shall be recognized under section 21;

(d) regulating the amount of fines imposed under sections 25 and 34, respectively;

(e) regulating the exercise of the discretion reposed in the registering officer by section 63;

(f) regulating the form in which registering officers are to make memoranda of documents;

(g) regulating the authentication by Registrars and Sub-Registrars of the books

-: 19 :- kept in their respective offices under section 51;

(gg) regulating the manner in which the instruments referred to in sub-section (2) of section 88 may be presented for registration;

(h) declaring the particulars to be contained in Indexes Nos.I, II, III and IV, respectively;

(i) declaring the holidays that shall be observed in the registration offices; and

(j) generally, regulating the proceedings of the Registrars and Sub- Registrars.

(2) The rules so made shall be submitted to the State Government for approval, and, after they have been approved, they shall be published in the Official Gazette, and on publication shall have effect as if enacted in this Act.”

The Karnataka Amendment to Section 69 of the Act reads as under:- In section 69(1), in sub-section (1),-

(i) in clause (g), after the word and figures “section 51”, insert the words” and the

-: 20 :- manner of re-copying such books on portions thereof”,

(ii) after clause (i), insert as following clause, namely:-

“(ii) prescribing the manner in which and the terms subject to which persons who write deeds outside the precincts of a registration officer, or who frequent the precincts of registration officers, for the purpose of writing documents may be granted licence and prescribing the fees to be paid for such licences;” [Vide Karnataka Act 55 of 1976, sec.13 (w.e.f. 23-10-1976).] After clause (j), insert the following clause, namely:- “(k) providing for the manner of return of documents under sub-section (2) of 61”.

-: 21 :- The object of the Act is registration of deeds and documents, in order to give public notice of transactions entered into by the citizens in respect of immovable property and such other transactions as envisaged under various provisions of the Act. The object of registration of documents relating to various types of transactions pertaining to immovable property is to afford a sense of security and to over come the practice of setting up forged and fraudulent documents; to protect subsequent purchasers or persons to whom subsequent conveyances of property made, from being affected by previous conveyances, unless those previous conveyances were registered. The main object of the Act is to provide a conclusive guarantee of the genuineness of the instrument although mere registration of a document is not by itself sufficient proof of its execution and genuineness. The Act also seeks to provide information to people

-: 22 :- who may deal with property as to nature and extent of the rights which persons may have affecting property. In other words, it enables people to find out whether any particular piece of property with which they may be concerned, has been made subject to any previous legal transaction. Therefore, the Act gives solemnity of form and legal importance to certain classes of documents by directing that they shall be registered. As a result of registration of documents, there is perpetuation of the documents, which are put on record, so as to enable people to see the record and enquire what the particulars are and as far as land is concerned, what transactions and/or obligations exist with regard to them. Thus, the registration of documents gives notice that such a document has been executed, to prevent fraud and forgery and to secure a reliable and complete account of all transactions effecting the title of the property.

-: 23 :- 11. Section 17 of the Act enumerates the instruments, registration of which is compulsory under the Act, whereas, Section 49 encompasses the effect of failure to register a transaction. The Act does not confine itself to registering documents relating to immovable property only, but also documents dealing with other matters such as adoption.

-: 24 :- 13. The expression “public policy” contained in sub-section (1) of Section 22A of the Act was considered by the Hon’ble Supreme Court in the case of Basant Nahata (supra). In the aforesaid decision, it was held that the Act only strikes at the document and not at the transactions. The whole aim of the Act is to govern the documents and not the transactions embodied therein, thereby only the notice of the public is drawn. Hence, Section 22A of the Act through a subordinate legislation cannot control the transactions that fall out of the scope thereof. Thus, the appeal filed by the State of Rajasthan was dismissed upholding the judgment of the Rajasthan High Court declaring Section 22A of the Act as unconstitutional and consequently, the Notifications assailed therein were also quashed. In the said case, High Court of Rajasthan had inter alia, held that Section 22A of the Act confers arbitrary powers on the

-: 25 :- State Government to determine as regards declaring a particular document being opposed to public policy. It was opined that the question as to whether a transaction is opposed to public policy or not can be determined only by the Courts competent authorities and not by the Sub-Registrar. The impugned legislation invaded the right of a citizen to deal with the property and thus, was wholly arbitrary and unreasonable. Also, the object of registration of a document is not achieved by the impugned legislation. Further, the Act deals with the deeds and documents and not transactions.

-: 26 :- concerned, any order passed by a Sub Registrar or Registrar, refusing to register a document pursuant to any Notification issued under Section 22A of the Act would not be reopened.

(2) KLJ 396 DB] held that Notification dated 23/04/2005 and Circular 23/08/2005 were unsustainable in law and they were quashed. The Division Bench further held that the question involved in the writ petition was no longer res integra having regard to the decision of the Hon’ble Supreme Court in the case of Basant Nahata (supra).

-: 27 :- 16. Further, in S.Sreenivasa Rao v. Sub Registrar [ILR 1990 Kar. 3740], a Division Bench has held that if a document is presented for registration by the executant, and in doing so, the executant complies with all the provisions of Registration Act, 1908, it is not open to the Sub- Registrar to refuse registration of the document unless, he exercises that discretion pursuant to any provision in the Act, or any other law or Rule having the force of law. The mere registration of a document is by itself not a proof of its validity, neither does it follow that the executant had title to the property, he seeks to dispose of under the document. Matters such as relating to title have to be decided before the appropriate forum. If any person is interested in contending that any particular document executed and registered under the Registration Act, 1908 is invalid or illegal for any reason whatsoever, he is certainly at

-: 28 :- liberty to question the validity of the document, the title of the executant, and such other questions before the proper forum in an appropriate proceeding.

-: 29 :- if presented in accordance with the provisions of the Act.

-: 30 :- documents are bogus or false, the party affected by it will have the right to initiate both civil and criminal proceedings to prosecute the party who tries to have benefit from such document and also to safeguard his right, title and interest. It was not for either the Tahsildar or the Sub-Registrar to express opinion as to the genuineness or otherwise of the documents, unless called upon by the Court of law or any other authorised investigating agency were the observations in the said case.

-: 31 :- Act. Section 69 deals with the power of Inspector General to superintendent Registration Offices, which pertains to making of rules on certain aspects of the Act and with regard to exercise of general superintendence over all the registration offices in the State. But, in the instant case, the Circular has been issued by the State Government and the State Circular itself states that it is pursuant to Section 22A of the Act. Therefore, the Circular cannot be related to Section 69 of the Act. On going through the said Circular, it is noted that the reference is made only to Section 21(1) and (4) of the Act, whereas, the reference made to other provisions are not under the Act, but other Acts, some of those Acts such as, the Land Reforms Act, 1961 Karnataka Scheduled Caste/Scheduled Tribes (PTCL) Act, 1978 and such other Acts whereunder transfer of land is prohibited.

-: 32 :- 20. It is reiterated that the Registration Act does not concern itself with the nature of transfer or alienation of properties, which are prohibited under other laws. It only states what documents pertaining to certain transactions, which have to be registered compulsorily when they relate to immovable property and with regard to certain other transactions, which need not be registered. The Act does not concern itself with the transactions, but relate to documents concerning transactions, which have to be registered compulsorily, in which event, provisions of the Act would have to be complied with by the parties. By the impugned Circular, the Sub-Registrar can in no way prevent a document pertaining to a transaction, which is prohibited under various laws from being registered. Once those transactions have taken place, the document pertaining to the transaction are registered under the Act, when the requirements of the Act are

-: 33 :- complied with. Unless the document pertaining to the transaction is registered, the transaction under various Acts, which are prohibited, namely, transfer of land by sale etc., would not become invalid, as it is only when the document pertaining to the transaction is registered would result in the completion of the transaction by transfer of title and by conveyance. Therefore, merely on an apprehension that a particular transaction may be prohibited under a particular enactment, the Sub-Registrar cannot prohibit the registration of the document pertaining to the said transaction. Rather it is only on completion of the transaction by registration wherever registration is compulsory, that the transaction, prohibited under a particular law, would become null and void. Therefore, even prior to the registration of document pertaining to a transaction, it cannot be presumed that the transaction is prohibited under an

-: 34 :- enactment and thus, refuse registration of the document. As already stated, a transaction is not complete until the document pertaining to a transaction is registered. The Sub-Registrar cannot assume the powers of a court or an authority to come to a conclusion that the transaction is prohibited under a particular enactment and thereby prohibit its registration. Then it would be a case of “putting the cart before the horse”.

-: 35 :- land to the effect that there is no violation of any statute in the transfer of land, the said affidavit would not in any way be of any assistance when subsequently it is discovered that there was in fact an infraction of any of the provisions of a statute when the transfer of land took place. Further, at the time of registration of documents pertaining to transfer of land, the Sub-Registrar cannot hold an enquiry as to whether any of the statutes or local laws have been violated. If by transfer of land, there is an infraction of any of the local laws, then the particular laws have the machinery for invalidating the transfer and may also contain penal provisions in that regard. Therefore, prior to the registration of the document, the transaction relating to the transfer of land being incomplete, the Sub-Registrar at that stage cannot prevent the transaction pertaining to transfer of land

-: 36 :- being completed on the assumption that there may be a violation of any of the local laws.

-: 37 :- Supreme Court in Basant Nahata (supra) and the Division Bench of this Court in D.Pavanesh (supra), wherein Section 22A of the Act has been struck down and the other decisions referred to above. All other circulars, which have been issued from time to time under Section 22A of the Act are also quashed.

Sd/-

CHIEF JUSTICE

Sd/-

JUDGE

*mvs/s*