WemayfirstnoticetheprovisionsofSection17(1)(b)of

theAct:
17.Documentsofwhichregistrationiscompulsory.
(1)Thefollowingdocumentsshallberegistered,if
thepropertytowhichtheyrelateissituateina
districtinwhich,andiftheyhavebeenexecutedon
orafterthedateonwhich,ActNo.XVIof1864,or
theIndianRegistrationAct,1866,ortheIndian
RegistrationAct,1871,ortheIndianRegistration
Act,1877,orthisActcameorcomesintoforce,
namely:
(a)\005\005..
(b)othernontestamentaryinstrumentswhich
purportoroperatetocreate,declare,assign,limitor
extinguish,whetherinpresentorinfuture,any
right,titleorinterest,whethervestedorcontingent,
ofthevalueofonehundredrupeesandupwards,to
orinimmovableproperty;
(c)(e)\005\005\005"
Clause(b)ofSection17(1)enjoinedregistrationof
nontestamentary
instrumentswhichpurportoroperatetocreate,
declare,assign,limitorextinguish,whetherinpresentorin
future,anyright,titleorinterest,whethervestedor
contingent,ofthevalueofonehundredrupeesandupwards,
toorinimmovableproperty.Thissectionspeaksofcreating
rightsorextinguishingrightsinpraesentiorinfuture.Any
rightcreatedorextinguishedinthepastisconspicuously
absent.Thecreationofanyrightorextinguishmentofany
rightisexpresslyexcludedbytheActitself.
ItiscontendedbyMr.Sundram,learnedSeniorcounsel
fortheappellantthattheawardoftheArbitratordoesnot
createanyrightorextinguishanyrightinpraesentiorin
future.HefurthersubmittedthattheawardoftheArbitrator
noticedthepreexistingfactsofaGiftDeeddated14.10.1956
registeredon10.6.1961andtherevocationofGiftDeedon
10.5.1971andpaymentofconsiderationamountreceivedin
lieuofgiftofplot.He,therefore,arguedthatbynostretchof
imaginationitcanbeheldthattheawardcreatedanyrightsor
extinguishedanyrightsinpraesentiorinfuturewhichwould
requireregistrationundertheAct.

Percontra,learnedcounsel
fortherespondentscontendedthattheawardcreatedrights
infavourofthesonsandextinguishedtherightsofthe
daughtersintheimmovablepropertyandtherefore,theaward
wouldrequireregistrationundertheAct.
Toanswerthisquestion,itwouldbenecessaryto
examinetheawardoftheArbitrator.
BeforeweexaminetheawardoftheArbitrator,wemayat
thisstagenoticethemutualagreemententeredintobetween
thepartiesreferringthedisputetotheArbitrator.The
dispute,whichwasreferredtotheArbitratorbytheparties,
waswithregardtoGiftDeedandtheresumptionofthe
propertygiftedinfavourofhisthreedaughters\026Smt.
Rajlakshmi,Smt.NirmalaandSmt.Sarsaswatisurvivedby
herhusband,B.C.Talwani.Afterthepartiesfiledthewritten
statementsanddocumentsinsupportoftheirrespective
claims,theArbitratorframedthefollowingissue:
"Whetherthegiftofthethreeplotsinfavourof
thedaughtersstillstandandwasnotrevokedand
theplotswerenotresumedbytheirfather?"
TheArbitrator,afterexaminingtheissues,cametothe
followingconclusion:
1.Thatthegiftwasmadein1956onconditionthat
thedaughterswouldbuildhousesandsettle
there.Nohouseswerebuiltduringthislong
period.Eventhepossessionwasneither
deliveredbythedonornorwaspossessiontaken
bythedonees.Adocumentdated10.05.1971,
Ex.K5isclear.
2.ThatthegiftwasnotacteduponeventheGift
Deedremainedinpossessionofthedonor,their
fatherthroughout.
3.ThatDewanNiranjanPrasadthedonorrevoked
thegiftandresumedthethreeplotsatthe
instanceandwiththeconsentofthedonees,the
daughters,whoagreedtotheresumptionofthe
plotsonthegroundthattheplotswerenotofany
remunerationvalueandagreedtoconvertthe
plotsintocash.Theyacceptedthecashinlieuof
theplotsasmentionedinEx.K04andEx.K5
andinwrittenstatements.
Smt.NirmalaspleathatRs.5000/werepaid
backtoheronaccountoftheloan,advancedby

herhusbandtoNavalherbrother,hasnotbeen
substantiated.Shedidnotmentioninherletter
dated17.08.1973Ex.K2,thatitwasaloan.
TheotheritemofRs.5,000/hasalsonotbeen
provedthatitwasduetoherotherwise.
5.Themutationofthelandinfavourofthe
daughtershasnovalue.Theentriesarewrong.
DewanNiranjanPrasadandSmt.Saraswati,who
arerecordedaspresent,haddiedlongbeforethe
mutationwassanctioned.Nonoticeappearsto
havebeenissuedtoanyparty.
6.ThattheexecutionoftheMemorandumof
Partition,whichisasubsequentactoftheLate
DewanNiranjanPrasad,impliedlyshowsalso
thatthegifttothethreedaughterswasrevoked.
IgivemyawardinfavourofShriKrishenJiwanand
ShriNavalJiwanandholdthatthegiftwasrevoked
andplotswereresumedbytheLateDewanNiranjan
Prasadattheinstanceandwiththeconsentofthe
secondpartinlieuofcashpaymentreceivedby
them."
TheawardoftheArbitrator,asquotedabove,would
clearlyshowthatbytheawardtheArbitratorsimplyrecorded
thefindingonthebasisofthepreexistingfacts,namely,the
GiftDeed,therevocationofthegiftandthepartitionofthe
propertybetweenhissonssubsequenttotherevocationofGift
Deed.Itisadeclarationofpreexistingrights.Itneither
createsanyrightnorextinguishesanyrightinpraesentiorin
future.WhatSection17(1)(b)oftheActrequiresisthe
creationofrightsbydecreeinpraesentiorinfuture.Inthe
presentcasetheawardoftheArbitrator,asnotedabove,
clearlydelineatedthepreexistingfacts,onthebasisofwhich
theawardwaspassed.
InCapt.(NowMajor)AshokKshyap(appellant)v.Mrs.
SudhaVasisht&anr.(respondents)AIR1987SC841,the
awardoftheArbitrator,thoughdeclaredtheshareofthe
partiesintheproperty,itcreatedarightbyitself,infavour
of
onepartytogetparticularsumfromanotherpartyandright
toobtainthepaymentandonpaymenttheobligationof
relinquishmentofrightorinterestintheproperty.ThisCourt
heldonananalysisoftheawardthatitdidnotcreateany
rightinanyimmovablepropertyandassuchitwasnot
compulsorytoregisterit.
ThisCourtinthecaseofSardarSinghv.KrishnaDevi

(Smt.)andAnr.(1994)4SCC18heldinparagraph12page
26(SCC)asunder:
"Itis,thus,wellsettledlawthattheunregistered
awardperseisnotinadmissibleinevidence.Itisa
validawardandnotamerewastepaper.Itcreates
rightsandobligationsbetweenthepartiesthereto
andisconclusivebetweentheparties.Itcanbeset
upasadefenceasevidenceofresolvingthe
disputesandacceptanceofitbytheparties.Ifitisa
foundation,creatingright,titleandinterestin
praesentiorfutureorextinguishestheright,titleor
interestinimmovablepropertyofthevalueofRs.
100oraboveitiscumpulsorilyregistrabieandnon
registrationrenderitinadmissibleinevidence.Ifit
containsameredeclarationofapreexistingright,
itisnotcreatingaright,titleandinterestin
praesenti,inwhicheventitisnotacompulsorily
registrableinstrument.Itcanbelookedintoas
evidenceoftheconductofthepartiesofaccepting
theaward,actinguponitthattheyhavepreexisting
right,titleorinterestintheimmovable
property.
(emphasissupplied)
Tobuttresshiscontention,learnedcounselforthe
respondentshasreferredtothedecisionofthisCourtin
RatanLalSharmav.PurshottamHarit(1974)1SCC671.
Inthatcasetheawardexpresslycreatedorpurportedtocreate
rightsinimmovablepropertyinfavouroftheappellant,which
requiredregistration.Thisisnotthepositioninthefactsof
the
presentcase.
LookingattheawardoftheArbitratorandthelawlaid
downbythisCourttheargumentsoflearnedcounselforthe
respondentsthattheawardcreatedanyrightorextinguished
anyrightinpraesentiorinfuturewhichwouldrequire
registrationundertheActisnotedonlytoberejected.
Intheresult,allthedecisionsofthecourtsbeloware
patentlyerroneousandaresetaside.Thisappealisallowed.
TheawardoftheArbitratorismadetheRuleoftheCourt.
ItisclearfromtherecordthatDewanNiranjanPrasad
diedon15.1.1975andSmt.Saraswatialsoin1966.The
respondentsfraudulentlyobtainedmutationon22.1.1977
showingDewanNiranjanPrasadandSmt.Saraswatias
present.Fraudclockseverything.

Fraudavoidsalljudicialacts.Adecreeobtainedby
playingfraudisanullityanditcanbechallengedinany
court,evenincollateralproceedings.(SeeS.P.
ChengalvarayaNaidu(Dead)ByLRs.V.Jagannath(Dead)
byLRs.&Ors.(1994)1SCC1.
Itisopentotheappellanttofileasuitagainstthelegal
heirsofSmt.Rajlakshmi,whoseappealhasbeenabated.If
thesuitisfiledwithintwomonthsfromtoday,itshallnotbe
dismissedasbeingbarredbylimitation.Withtheaforesaid
directions,theappealisallowed.Partiesareaskedtobear
theirowncosts.