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CONTENTS

Introduction

Registration of property

Registration as constructive notice

Case laws

Conclusion

Bibliography


















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INTRODUCTION

Section 5 of The Transfer of property Act, 1882 defines Transfer of property as In the
following sections transfer of property means an act by which a living person conveys
property, in present or in future, to one or more other living persons, or to himself, or to himself
1
and one or more living persons; and to transfer property is to perform such act.
In this section living person includes a company or association or body of individuals, whether
incorporated or not, but nothing herein contained shall affect any law for the time being in force
relating to transfer of property to or by companies, associations or bodies of individuals.
2

The word transfer is defined with the reference to the word convey. This word in English
Law in its narrower and more usual sense refers to the transfer of an estate in land; but it is
sometimes used in a much wider sense to include any form of assurance inter vivos.
The word conveys in Section 5 of the Indian Act is used in the wider sense referred to above.
Transferor must have an interest in the property. He cannot sever himself from it and yet convey
it.
3
A lease comes within the meaning of the word transfer.
4

The words living person exclude transfers by Wills and the Will only operates after the death
of the testator.
5

In Ma Kyin Hone v. Ong Boon Hock,
6
a single Judge of the Rangoon High Court said that the
word transfer is a word of very wide meaning and includes every transaction whereby a party
divests himself or is divested of a portion of his interest, that portion subsequently vesting or
being vested in another party. This meaning of transfer is supported by the aforesaid definition
in the Act.
The Legislature has not attempted to define the word property, but it is used in this Act in its
widest and most generic legal sense
7
. Section 6 says that property of any kind may be
transferred, etc. Thus an actionable claim is property
8
and so is a right to a reconveyance of land.
9
Property is not only the thing which is the subject matter of ownership, but includes the
dominium or the right or ownership or of partial ownership, and as Lord Langdale said it is the

1
Ins. by Act 20 of 1929, sec. 6.

2
Ibid.

3
See Mulla, The Transfer of Property Act, 9
th
Ed., LexisNexis Butterworths, 2004, p. 73.

4
Krishna Kumar Khemka v. Grindlays Bank PLC, AIR 1991 SC 899.

5
See topic Living Persons at p. 3.

6
AIR 1937 Rang. 47.

7
Bansigopal v. V.K. Banerji, AIR 1949 All. 433.

8
Rudra Perkash v. Krishna, (1887) 14 Cal. 241, 244.

9
Narasingarji v. Panaganti, AIR 1921 Mad. 498
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most comprehensive of all terms which can be used inasmuch as it is indicative and descriptive
of every possible interest which the party can have.
10

It may be noted that property is essentially a bundle of rights and interests. When a property is
transferred, there may be transfer of all the rights in that property or only some of it. All the
rights in the property signify ownership or absolute interest. Only some rights or interests in a
property would mean partial or limited interest. In Sunil Sidharthbai v. Commissioner of
I ncome Tax,
11
the Supreme Court rightly observed that in general, transfer of property means
passing of a right in the property from one person to another. In one case there may be passing of
entire bundle of rights from transferor to transferee, but in another case there may be transfer
only some of such rights. This, if A makes a gift of his house to B, there is transfer of absolute
interest of the house. It is a transfer of property. On the other hand, if A transfers the right of
enjoyment of his house to B for a certain period it is called alease. It is transfer of only
partial interest in the house but it is also a transfer of property.
12

NOTICE
The Transfer of Property Act, 1882, Section 3 defines notice:
A person is said to have notice of a fact when he actually knows that fact, or when, but for
wilful abstention from an enquiry or search which he ought to have made, or gross
negligence, he would have known it.
Notice literally means knowledge, and this doctrine under the TP Act is used to determine
the rights and claims of two or more persons vis-a-vis each other, who are involved in an
unconscionable transaction. The person responsible for creating such a condition is not part
of the situation any more, and the other persons fight with each other for a claim or a piece
of property. In such a scenario, the court determines their rights with the help of doctrine of
notice.
KINDS OF NOTICE

ACTUAL NOTICE
CONSTRUCTIVE OR IMPLIED NOTICE; AND
NOTICE TO AGENT.
Actual Notice
Actual notice means actual knowledge, where it can be shown that a person actually knew
about it. It is definite information given to, or obtained by

a person, as against vague

10
Jones v. Skinner, (1835) 5 LJ Ch. 87, 90.

11
AIR 1986 SC 368
12
Sinha, Dr.R.K., The Transfer of Property Act, 11
th
Ed., Central Law Agency, Allahabad, 2010, p. 53.

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rumours, statements or casual comments given by strangers. For instance, a person attesting
the execution of a deed cannot say that he did not know that the deed was being executed. The
knowledge or notice must be definite. As mentioned, it should not be hearsay or rumours
13

and should be of such a nature that it would be expected that a normal man would take it
seriously. Only the knowledge of the parties interested in the transaction is actual notice
regarding the transaction, and knowledge of strangers to the transaction is no notice of the
transaction. Knowledge must be in relation to the transfer in question, and not general or
irrelevant to the transaction.
Constructive Notice
Constructive notice means knowledge that the court imputes on a person. A person may
claim that he did not know a fact, but if the circumstances surrounding him are such, that
as a reasonable prudent person, he ought to have known a fact, he will be deemed to know
it. It is pertinent to note that the consequences of actual or constructive notice are identical.
Constructive notices can be applied by the court in five cases:

When there is a willful abstention from making an inquiry;
14

Gross negligence;
Registration of the document/transaction;
Actual possession; and
Notice to agent.
Thus, a person is said to have notice of the fact when he actually knows the fact, or, when but
for the wilful abstention from an enquiry or search which he ought to have made, or gross
negligence, he would have known it.
15

Actual notice of a deed is constructive notice of all the material facts affecting the property, which
appear on the face of the deed or can be reasonably inferred from its contents.
16
It is also notice of all
documents recited in the deed, and which an examination of the deed would have disclosed, provided
the deed formed part of the chain of title and so necessarily affects the property!' It means that where a
person has actual knowledge of the existence of a document relating to the property in question, he
would be imputed with constructive notice of not only the contents of this document, but also of all the
relevant papers that can be ascertained after reading the main document as well. Thus, where, on a
partition of the family property the deed contains a mutual covenant of a right of pre-emption in favour
of either of the brothers, should any one of them want to sell the property in the future, and one of
them sells his share by a deed which describes as his share as acquired under a deed of partition,
the purchaser has constructive notice of the right of pre-emption.

13
Lloyd v. bank,(1868) LR 3 Ch 488, 490.
14
N Kasinath v. Arun R Rawwli, AIR 2008 (NOC) 1620
15
Motilal jain v. Prakash Bhartiya, AIR 2007 (NOC) 377 (MP)
16
Rajaram v. krishnaswami, (1893) 16 Mad 301.
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Constructive notice is imputed only in situations where a person has means of knowing a
particular fact, but has failed to know it. There exist circumstances which ought to put him on an
inquiry, which, if prosecuted, would have led to a discovery of it.
17
However, if a person has no
means or opportunities to obtain information about something, notice cannot be imputed on him
about that thing. Thus, where the purchaser does not have the slightest idea or suspicion
about any earlier agreement entered into, far away from the place where the property is
situated, it cannot be said that there was any willful abstention on the part of the purchaser.
18

Notice to Agent
Notice or knowledge of a fact to any agent amounts to constructive notice to his principal. The
principal cannot deny that the notice of the fact was to agent and not to him. The rule that a
principal was bound constructively with notice of certain facts to his agent was added in section
3 by explanation III under the amending act, 1929. Notice to an agent is also called imputed
agent. It is called imputed notice because it a person authorizes someone to act as his agent for
doing certain things; he is supposed to have control over the activities of that agent with respect
to that thing. Where such agent does something beneficial to the principal, it is obvious that
principal would accept the knowledge of that act of his agent even though he has no actual
knowledge (notice). But, where some act of that agent goes against the interests of the principal,
he would take the plea that he had no notice of that act. In such cases the equity would not allow
him to say that he has no notice of that act of his agent. In other words, the notice in such
circumstance would be imposed or imputed on him. The reason for this rule is that if were not so,
every principal would be successful in avoiding unfavourable notice by appointing an agent.
19

REGISTRATION
Registration of the property is a full and final agreement signed between the two parties. Once a
property is registered, it means that the property buyer in whose favor the property is registered
is the lawful owner of the premises and is fully responsible for it in all respects. The law does not
recognize unregistered owners and does not give them any rights over the property. Therefore,
Registration of Property is Compulsory to prevent fraud or future litigation.
Registering the documents relating to the transfer, sale, lease or any other form of disposal of a
property is compulsory under section 17 of the Indian Registration Act, 1908. The aim of the
registration is to prevent fraud, in addition to create and maintain an up-to-date public
record. The registration can take place at the Sub-Registration Office within which the property
is located or in the District Sub-Registrar Office of the District where the property is located.



17
Ram coomar coondoo v. Macqueen, (1872)11 Beng LR 46
18
Harak chand v. Sohan raj, AIR 1990 Raj 109.
19
Berrick & Co. v. Price, (1905) I ch. 632: See A.K.Rays TRANSFER OF PROPERTY ACT, Vol.I,Ed.VIII,p.149.
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REGISTRATION OF PROPERTY
Registration is a process through which a document is officially recorded. It takes place under
the provisions of the Indian Registration Act, 1908. When a document is registered, it becomes
important and valuable evidence regarding the statements made in the document. Under the
Transfer of Property Act, certain transfers must he made only through a registered deed. For
example, gift of an immovable property of any valuation, sale of immovable property above
rupees one hundred, simple mortgage etc. can be made only through a document duly attested
and registered. In other words, the deeds of such transfers are compulsorily registrable.
Section17 of the Registration Act provides a list of documents which are compulsorily
registrable. On the other hand, there are certain documents, dealt with under Section 18 of the
Registration Act, the registration of which is optional, e.g., Wills, sale of immovable property of
valuation less than one hundred ropers etc . Where a document is compulsorily registerable but
has not been registered, the transfer under it is not valid and courts do not recognize that transfer.
But when registration is optional, e.g., wills, the transfer is valid even though the deed is
unregistered.
Briefly stated, the procedure for registration of a document is as under. The transfer which is to
be made through a deed is first of all, written on the stamp- papers of prescribed value
Thereafter, the executant puts his signatures and two attesting witnesses attest the execution.
This document, which is now duly executed and attested, is presented before the Sub-Registrar
or Registering ashore basing appropriate jurisdiction. The Sub-Registrar, after taking the
statement of the executant and the identifying witnesses and also the thumb impression of the
executant on appropriate register admits the deed for registration. The registration-fee prescribed
under the Law is also charged. The document is then recorded (copied or its duplicate is filed) in
the prescribed register. After these formalities, the Sub-Registrar certifies on the back of the deed
that the document has been duly registered on the date and time mentioned by him. After
affixing the official seal, the deed is returned to the parties concerned. It may be noted that the
deed is deemed to be registered not on the date on which it was admitted for registration. It is
deemed to be duly registered on the date and at a time which is mentioned by the Sub-Registrar
under his certificate. It is also to be noted that registration must have been completed in all
respects strictly according to the provisions of the Indian Registration Act. However, once a
document has duly been registered, the Registering Officer (Sub-Registrar) has no authority to
modify or, delete any entries made in any of the books of record relating to validity of that
document. Therefore, on a subsequent date he cannot delete or modify any entry made in the
'encumbrance certificate' except where it relates to a clerical error.
20

Section 3 of the Transfer of Property Act provides that if a document is duly registered in any
part of the country to which this Act extends, it would mean to have been registered for other

20
M. Ramkrishna Reddy v. sub-registrar, Banglore, AIR 2000 kant. 46.
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places too. In other words, court would accept a registered document as evidence irrespective of
the fact as to where it was registered.
Documents To Be Compulsorily Registered:
There are certain documents, which need to be compulsorily registered. These are specified
under Section 17 of the Indian Registration Act 1902. These include:
Documents related to gift of immovable property. Any gift deed irrespective of the value
of the gifted property needs to be registered.
All non-testamentary documents which create interest, right, or title in immovable
property.
All non-testamentary documents which extinguish or cancel any right, interest, or title in
the immovable property.
All non-testamentary documents which declare, assign, limit or restrict the interest, title,
or right in immovable property.
All non-testamentary documents which acknowledge the receipt or payment of any
consideration on account of transactions pertaining to right, title, or interest in the
immovable property.
All non-testamentary documents transferring or assigning any decree or order, which
affects the interest, rights and title in an immovable property.
Most types of mortgages need registrations. However, mortgages created by depositing title
deeds (also known as the equitable mortgage) are not compulsorily registrable. Under the
provisions of Section 54 of the Transfer of Property Act 1882, the sale of immovable property,
the value of which is Rs 100 or more, should be registered. If the value of the immovable
property is less than Rs 100, the registration of sale deed is not compulsorily registrable. So,
effectively, all property sale deeds need to be registered.
In case of leases of property, a lease of immovable property from year to year or for a term
exceeding one year must be done only by registration. The term from year to year denotes a
continuity of lease from year to year. In such a case, the landlord has no option to terminate the
lease at the end of the year without notice. The term 'reserving yearly rents' means that the
annual rent has been determined but the lease has no definite period. The lease should run year
after year or at least more than a year. This means any lease which is in excess of a year should
be registered.


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REGISTRATION AS CONSTRUCTIVE NOTICE
The Indian Registration Act 1908 specifies the documents that have to be compulsorily
registered and those that are not compulsorily registrable. This is further clarified under the
provisions of the Transfer of Property Act 1882.
The Transfer of Property Act, 1882, Section 3:
Explanation I.Where any transaction relating to immoveable property is required by law to be
and has been effected by a registered instrument, any person acquiring such property or any part
of, or share or interest in, such property shall be deemed to have notice of such instrument as
from the date of registration or, where the property is not all situated in one sub-district, or where
the registered instrument has been registered under sub-section (2) of section 30 of the Indian
Registration Act, 1908 (16 of 1908), from the earliest date on which any memorandum of such
registered instrument has been filed by any Sub-Registrar within whose sub-district any part of
the property which is being acquired, or of the property wherein a share or interest is being
acquired, is situated:
Provided that
(1) The instrument has been registered and its registration completed in the manner prescribed by
the Indian Registration Act, 1908 (16 of 1908), and the rules made there under,
(2) The instrument or memorandum has been duly entered or filed, as the case may be, in books
kept under section 51 of that Act, and
(3) The particulars regarding the transaction to which the instrument relates have been correctly
entered in the indexes kept under section 55 of that Act.
GENERAL PRINCIPLE
As has already been mentioned, in matters relating to transfer of property, the parties have to
observe three mandatory formalities. The transfer must take place with a written document that is
signed by the transferor, is properly attested and is registered. These formalities must be
observed, unless the property is of nominal value (less than Rs. 100) or is let out for less than a
year, or is mortgaged either by an equitable mortgage or for a loan of less than Rs. 100. Unless
all the formalities are complied with, no right will pass from the transferor to the transferee. It
must be noted here that all the formalities except registration are treated as private affair, and
registration is the only formality that makes a transfer from a purely private to a public affair. In
transfers of property, as registration by and large is a mandatory requirement, more so when it is
transfer inter vivos, the duty of a prospective transferee is to search the registers and ascertain the
registered transactions that had taken place in the past, relating to this particular property. A
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failure to inspect the registers will result in the imputation of constructive notice with respect to
all the transactions that are required, by law, to be compulsorily registered.
21

All purchasers, therefore, are under a legal obligation to exercise diligence in examining the
title recorded in the register to avoid uncertainties and the risk of perjury in taking parole
evidence as to whether the omission to search the register should in any particular case be
attributed to gross negligence.
22
For instance, A sells the house by a registered document to B. He
later enters into a contract with C to sell him the same house. Law imposes a duty upon C to
inspect the registers at the Registrar's office, and if he does that, he would come to know about
the sale in favour of B. A failure to inspect the register will be detrimental to the interests of C,
as he would be imputed with constructive notice of the registered transaction.
LEGISLATIVE HISTORY
The statutory provision providing that registration of a compulsorily registrable document
operates as constructive notice was introduced in the Act by the amending Act of 1929.
Though the Registration Act was promulgated in 1908, and provided for compulsory registration
for transfer of immovable property (except as aforesaid when it is of a nominal value or is to let
out for a period of less than a year), yet whether registration of a transaction would or would
not amount to notice continued to be a subject of judicial controversy till the Privy Council in
Tilakdhari Lal v. Kundan Lal,
23
held that as the TP Act did not specifically provide it as a
principle, registration would not, per se, amount to constructive notice and this issue would vary
depending upon the facts and circumstances of each case. The view accordingly to Bombay
and Allahabad High Courts was that it would amount to notice. The Calcutta High Court,
on the other hand, took the view that this issue has to be decided keeping in view the facts and
circumstances of each case. Thus, in some cases they held that it amounted to constructive
notice, while in others it was held that there was no duty on part of the prospective
transferees to inspect the registers. The Madras High Court held that it would not amount
to notice.

In 1929, by an express amendment, Explanation I was added to the definition of
notice in s. 3. The effect of such inclusion was that the decision of the Privy Council is no
longer good law.
CONDITIONS FOR APPLICATION
The law is subject to the following conditions.
(1) The instrument has been registered and registration completed in the manner provided in the
Registration Act, 1908;
24


21
The transfer of property Act, 1882, s.3; Rajo kuer v. Brij Bihari Prasad, AIR 1962 Pat 236.
22
Tilakhdari lal v. Khedan Lal, AIR 1921 PC 112.
23
47 IA 239; AIR 1921 PC 112.
24
See The Transfer of Property Act, 1882, s. 3.
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(2) The instrument or memorandum has been duly entered or filled in, as the case may be, in
books kept under s. 51 of the Registration Act, 1908 and;
(3) The particulars relating to transactions to which the instruments relate have been correctly
entered in the index(s) kept under s. 55 of the Registration Act, 1908.
25

Constructive notice will not be imputed unless the document is registered, in accordance with the
manner provided under the Registration Act, 1908 and the instrument or memorandum has been
duly entered in the books/registers and particulars are correctly entered in the index(s).
Where the instrument has been registered in accordance with the provisions of the Registration
Act, 1908, a party cannot say he searched the register and could not find the relevant portion; he
would take the consequences of his want of diligence.
26
Thus, registration of a mortgaged deed
itself is sufficient notice to the persons dealing subsequently with the mortgaged property,
particularly where the debtor is a notorious man and his dealings with the mortgagee were very
well known in that locality. Thus, where the mortgagee affects a sub-mortgage of the property
with a registered instrument, the registration of the sub mortgage would not amount to
constructive notice to the original mortgagor, who, in ignorance of the sub mortgage, makes the
payment to the mortgagee.
27
However, the mere fact that a person resides at a place where the
deed is registered is insufficient to fix him with notice of the deed. Thus, where an agreement
provides that defendant's movable and immovable properties will be subject to a charge of the
money due to the plaintiff, and he subsequently mortgages them to C, the plaintiff has no right to
contend that he cannot do so. C would be allowed to plead bona fide purchaser having no
notice.
28

The purchaser would not be affected with constructive notice of the registered agreement
restricting the use of the property, if it is shown that the agreement was not indexed in relation to
the property sold.
29
A mere defect in the procedure would not invalidate registration, but
misplaced entries will not operate as constructive notice.

NO NOTICE WHERE REGISTRATION IS NOT COMPULSORY
Where the registration of a document is not compulsory under the Registration Act, 1908, its
registration would not amount to constructive notice. Documents that are compulsorily required
to be registered are as per s. 54; paras 2 arid 3 specify that in case of tangible immovable

25
Gordhandas v. Mohanlal, AIR 1921 Born 161.
26
Srimatty Akshay Kumarz v. Kanai Lal, 16 IC 618, (1912) 17 Cal WN 224; Renukabai v. Bhavan, AIR 1939 Nag 132: 185 IC
33.
27
Hira la/ v. Chanan Khan, AIR 1914 Lab 326; see also Sahadev v. Shekh Papa, (1905) ILR 29 Born 199.
28
Sahadev v. Shekh Papa, (1905) ILR 29 Born 199; Prabhu La/ v. Chattar, AIR 1925 An 557.
29
Gordhandas v. Mohanlal, AIR 1921 Born 161.

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property, of the value of Rs. 100 or more, or in case of a reversion or intangible thing, can be
made only by a registered instrument and in case of tangible immovable property of a value less
than Rs. 100 can be made by either a registered instrument, or by delivery of property. 'Thus, if
property of less than Rs. 100 were sold by a registered document, its registration would not
amount to constructive notice, as it is not mandatory in law. According to s. 59, where the
principal money secured (load) in a mortgage is Rs. 100 or more, a mortgage other than a
mortgage by deposit of title deeds, can be effected only by a registered instrument signed by the
mortgager, and attested at least two competent witnesses. Similarly, for a transfer of immovable
property by way of a lease under s. 107, it is laid down that a lease of immovable property
from year to year, or for any term exceeding one year or reserving a yearly rent can be made only
by a registered instrument. In case of all transfers of immovable property by gift, transfer,
according to s. 123, must be affected by a registered instrument signed by or on behalf of the
donor (transferor), and attested by at least two witnesses. In case of gifts of movables, there is an
option to execute it either by way of a written attested and registered document or by a simple
delivery of possession. Where registration of a document is no: mandatory but only an option,
then registration would not operate as a constructive notice. For instance, a partition deed is
not required to be registered; in fact, it is not required by law to be in writing, as is shown in
the following example. A joint family comprises of a father and his son. They together own a
land and a house that the father manages, as the karta. A partition is affected and the land goes
to the son while the father keeps the house. The partition deed is registered. Later, the father
sells the land to B. B is supposed to be vigilant as a prospective transferee, and though the
elements of gross negligence and willful abstention from an inquiry have to be looked into inde-
pendently, mere registration of partition deed would not amount to constructive notice. Thus,
registration of testamentary instruments;
30
document pertaining to transfer of movable
property;
56
equitable mortgages; or gift of property given to the daughter by way of pasupu
kumkuma would not amount to constructive notice.
In Harendra Nath Dutta Roy v. Rajendar
31
, a partition took place between four brothers, by a
written attested and registered deed. The terms of partition gave preferential right to purchase
property to the former co-owners (called a right of pre-emption), if an- one of them decided to
sell his respective share. These terms could have been ascertained by inspecting the partition
deed. One of the brothers, without consulting the other co- owners, sold his share to a stranger,
A. A suit of pre-emption was filed by a former co- owner B, who also claimed that A should be
deemed to have constructive notice of the pre-emption clause, on the ground that since the
partition deed was registered its mere registration would amount to a constructive notice of its
contents as far as A was concerned. The court negativated his contention on the ground that a
partition may be entered even orally, and there is no provision in any law requiring the
transaction of partition to be registered. The fact is that if it is reduced to writing and

30
Baba Ramchandra V. Kondeo Jogna, AIR 1940 Nag 7.
31
AIR 1974 Gau 43.
12 | P a g e

registered, its registration would not amount to constructive notice, as its registration is not a
mandatory requirement in law. Hence, the court held that registration of partition deed would not
amount to constructive notice on A. Similarly, A, mortgages her jewellery to B, with the help of a
written and registered deed but retains possession of it, with an understanding that if within 10
years she fails to repay the amount, B would have a right to recover the loan amount by the sale
of this jewellery. A sells the jewellery to C, for full consideration. Though the mortgage deed is
registered, its registration would not amount to constructive notice, as mortgage of movables is
not required by law to be compulsorily registered.

REGISTRATION AS CONSTRUCTIVE NOTICE ONLY FOR SUBSEQUENT
TRANSFEREES
Registration as constructive notice operates only for subsequent transferees and not for former
transferees. It is implicit from the use of the words 'any person acquiring such property or any
part of or share or interest in such property is deemed to have notice of such instrument as
from the date of registration'. For example, A contracts to sell a house to B for a sum of Rs.
10 lakh, accepts an advance of two lakhs from him but then sells it to C with a written, attested
and registered document. In litigation between B and C for this property, C cannot take the
plea that as the transaction in his favour is through a registered document, B ought to have
constructive notice of the same, because B is a prior transferee and registration as constructive
notice would not operate on prior transferees. However, in the same case, If after the conclusion
of the contract between A and C, A sells the same house to D, then C would be entitled to plead
registration of the transaction as constructive notice as against D as D is a subsequent transferee.

TIME FROM WHEN REGISTRATION WOULD OPERATE AS CONSTRUCTIVE
NOTICE
The time from when registration of a document that is required by law to be compulsorily
registrable, depends on the location of the property. If the property is situated in the same
district where the document is also registered, it operates as constructive notice from the same
date. However, if it is situated in several sub-districts or it has been registered in another sub-
district, then its registration would operate as constructive notice from the date when the
memorandum was received in the district where it is situated and filed by the sub-registrar of
the sub-district where the property is situated.



13 | P a g e

CASE LAWS
In Harendra Nath Dutta Roy v. Rajendar
32
, a partition took place between four brothers, by a
written attested and registered deed. The terms of partition gave preferential right to purchase
property to the former co-owners (called a right of pre-emption), if an- one of them decided to
sell his respective share. These terms could have been ascertained by inspecting the partition
deed. One of the brothers, without consulting the other co- owners, sold his share to a stranger,
A. A suit of pre-emption was filed by a former co- owner B, who also claimed that A should be
deemed to have constructive notice of the pre-emption clause, on the ground that since the
partition deed was registered its mere registration would amount to a constructive notice of its
contents as far as A was concerned. The court negativated his contention on the ground that a
partition may be entered even orally, and there is no provision in any law requiring the
transaction of partition to be registered. The fact is that if it is reduced to writing and
registered, its registration would not amount to constructive notice, as its registration is not a
mandatory requirement in law. Hence, the court held, that registration of partition deed would
not amount to constructive notice on A.
In Bank of Bombay v. Suleman,
33
a person died and in his will, left his house and land to his
sons from his first wife. He also left behind four sons from his second wife, who had not attained
majority. In his will, he had provided that the sons from the first wife were to get the land and the
house, but they were also under an obligation to pay Rs. 30,000 to the sons from the second wife
within a period of six months from the date of operation of the will, and this sum was a charge
on the land and the house. The sons from the first wife did not pay this amount, and in the course
of their business, mortgaged the land and the house to the bank by deposit of title deeds. The
bank advanced a loan of Rs. 52,000 and when the sons failed to pay the loan amount, brought the
property up for sale. The sons from the second wife now contended that their claim, over the
land and the house had precedence over the bank's claim, as the later would be deemed to have
constructive notice of the same. The bank pleaded ignorance of the knowledge of the existence
of this charge as a copy of the will, was not amongst the documents deposited with the bank. The
court held that if the bank had made enquiries as to how the sons had derived the title to the
property, it would have known about the will and an inspection of the will could have brought
them the knowledge of the charge. In not doing so, they were guilty of wilful abstention from
making an enquiry, and therefore were imputed with constructive notice of the charge in favour
of the sons from the second wife, who, it was held, had priority of claim.
In Lloyd's Bank v. PF Guzdar Co.,
34
the conflicting claims were of two banks, Bank A and
Bank B, who were defrauded by X The facts were as follows. X was a regular customer of
Bank A. He deposited the title deeds of his house with them and secured an overdraft. He

32
AIR 1974 Gau 43
33
(1909) ILR 33 Born 1.
34
(1929) ILR 56 Cal 868.
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thereafter told the bank that in order to clear the overdraft, he wanted to sell the house, and for
this purpose, he wanted to show the title deeds to the prospective purchaser. At the same time,
he also requested the bank, not to disclose the fact of loan, as he apprehended that it would
adversely affect the price he was hoping to fetch after the sale of the house. The bank gave
back the title deeds to X, and he returned them to the bank after a week, as the sale could not
be finalised. A month later, X repeated his request to the bank, and the latter again gave him
the title deeds of the house. This time X took the title deeds of the house to Bank B, and
secured a loan after depositing the same with Bank B. The loan was not paid and Bank B
wanted to sell the property. Now Bank A claimed priority on the ground that die property was
subject to mortgage with them. The question before the court was whether Bank B could be
imputed with constructive notice of the right of Bank A over the property. This issue has to be
examined in light of the duty of Bank B as a reasonable, prudent transferee. Can it be said
that Bank B was guilty of willful abstention from making an enquiry or gross negligence? The
answer to both these questions will be in the negative. If the title deeds of the house were in
order, and deposited with the bank, and the bank, after securitisation of the same grants a
loan, it cannot be said that they acted negligently, or that there was any starting point of
inquiry that they needed to probe further. Rather, they had been vigilant and had taken care
of their interests in a reasonable manner. On the other hand, it was Bank A, whose conduct
was tainted with gross negligence, as they had parted with the very papers which were the
security for the loan. In not looking after their own interests, they could not look upon the court
for protection, as even the court cannot protect the interests of those who fail to do it
themselves by being grossly negligent.
Tilakdhari Lal v. Kundan Lal,
35
held that as the TP Act did not specifically provide it as a
principle, registration would not, per se, amount to constructive notice and this issue would vary
depending upon the facts and circumstances of each case. The view accordingly to Bombay
and Allahabad High Courts was that it would amount to notice.

The Calcutta High Court,
on the other hand, took the view that this issue has to be decided keeping in view the facts and
circumstances of each case. Thus, in some cases they held that it amounted to constructive
notice, while in others it was held that there was no duty on part of the prospective
transferees to inspect the registers. The Madras High Court held that it would not amount
to notice. In 1929, by an express amendment, Explanation I was added to the definition of
notice in Sec. 3. The effect of such inclusion was that the decision of the Privy Council is no
longer good law.





35
47 IA 239; AIR 1921 PC 112
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CONCLUSION
The system of registration of documents was in vogue in British India first in Bengal in 1793,
thereafter in Bombay and in Madras in 1802. These regulations were applicable both in
Presidency Towns as well as Moffusil. The Registrars were appointed for each district and
required them to register the following documents:
1. Deeds of sale or gifts of lands, houses and other real property;
2. Deeds of mortgage on land, houses and other real property, as well as certificates of the
discharge of such encumbrances;
3. Leases and limited assignments of land, houses and other real property, including generally,
all conveyances used for the temporary transfer of real property;
4. Wasseathnamas or Wills;
5. Written authorities from husbands to their wives to adopt sons after their (husbands') demise;
IMPORTANCE
Section 6 of the Madras Regulation was similar in terms to the corresponding provisions of the
Bombay and Bengal Regulations. This was the most important provision of these Regulations.
MuHa's commentary on the Registration Act sets out in full section 6 of the Bombay Regulation.
Firstly, it provided that every deed of sale or gift registered under the Regulation would
invalidate any unregistered deed if the same nature whether executed prior or subsequent to the
registered deed.
Secondly, it provided that every registered mortgage deed would have priority over any
unregistered mortgage deed whether executed prior or subsequent to the registered mortgage.
Thirdly, it stated that the object of the two preceding rules was to prevent persons being
defrauded by purchasing or receiving in gift or taking in mortgage real property which may have
been before sold, given or mortgaged, and that persons would never suffer such imposition when
they are appraised of the previous transfer or mortgage of the property.
It therefore provided that if the buyer, done or mortgagee had knowledge of the previous sale,
gift or mortgage, the rule of invalidation or priority mentioned in the previous two clauses would
not apply.
Registration Act, XVI of 1864 was enacted except in Bombay where an important change was
introduced by a Regulation of 1827. Section 13 of that Act provided that, certain documents shall
not be received in evidence in any court or be acted upon by any public officer unless the
document shall have been registered. It may noted that this section itself did not specifically say
16 | P a g e

that these documents must compulsorily registered but the same result was secured by means of
the sanction of refusing to receive in evidence such documents, if unregistered. The Registration
Act, XX of 1866 provided that instruments of the four classes mentioned therein must be
registered. The Registration Act, 1866 was repealed by the Act III of 1877 which was amended
from time to time till it was replaced by the present Act XVI of 1908.
The Indian Registration Act, 1908 presently extends to whole of the territory of India excluding
the state of Jammu and Kashmir to which State the relevant legislative power of the Parliament
does not extend.
The provisions of the Act may be broadly grouped under three heads. The first head relates to the
documents which are registerable under the Act. The second relates to the procedure to be
followed for getting a document registered under the provisions of the Act. The third deals with
the administrative machinery provided under the Act and the respective duties of the different
classes of officers.
The documents registerable under the Act fall under three categories. In the first category,
documents relating to transactions which according to the substantive law, can be effected only
by registered documents. It is hardly necessary to point out that the Registration Act does not lay
down that any transaction in order to be valid, must be effected by a registered instrument. what
it provides is that when there is a written instrument evidencing a transaction, it must, in certain
cases, be registered, while in other cases, it may, at the option of the parties, be registered, in the
manner laid down in the Act. The obligation to get a transaction effected only by a registered
instrument is laid down by the substantive law. Thus, as per the provisions of the Transfer of
Property Act, 1882 sales, mortgages, exchanges, gifts and leases requires to be effected only by
registered instruments subject to an exception in case of some transactions relating to immovable
property of less than a,:100 in value. Similarly, as per section 5 of the Indian Trusts Act, 1882 a
trust in relation to immovable property is valid only if it is declared by a non-testamentary
instrument in writing signed by the author of the trust or the trustee and registered or by the will
of the author of the trust or of the trustee. The substantive law, however, does not provide the
machinery for effecting registration. It is the Registration Act which provides the machinery for
effecting registration and the parties to the registerable documents must necessarily have
recourse to the provisions of this Act.
Under the substantive law, certain transactions can be effected without a writing example
partitions, releases, settlements etc. But, if the transaction is evidenced by a writing and relates to
immovable property, the Registration Act steps in and clauses (b) and (c) of Section 17(1)
require registration of such documents, subject to the exception specified in sub-section 2 of that
section. If an authority to adopt is conferred in writing, other than a Will, it is also required to be
registered :section 17(3)]. These documents fall under the second category.
17 | P a g e

It is open to the parties, if they so choose, to get certain documents registered at their option and
this is permitted by section 18. Wills need not be registered but it is open to the parties to get
them registered under the third category.
The Act further provides for the consequences of non-registration of documents [section 49] and
the effects of registration [section 48 and 50]. To enable a person to get a document registered
under the Act, certain conditions have to be fulfilled and certain formalities to be observed. The
document must contain a description of the property and has to be presented for registration in
the proper registration office within the time limited by the Act. The details regulating
presentation, such as time for presentation, place of presentation, persons entitled to present a
document and the mode of enquiry before the Sub-registrar are all dealt with in various parts of
the Act. If the Registrar also refuses registration, a suit under section 77 can be filed within 30
days of his Oder for a direction that the document be registered. This in brief is a summary of the
procedure laid down by the Act.
The Act also prescribes the machinery for the administration of the Act. The administration of
the Act is the duty of each State Government. Each state is divided for the purposes of the Act
into districts and sub-districts. At the apex of the administration is the Inspector General of
Registration and under him a Registrar for each district and a Sub-registrar for each sub-district.
Besides these, there is a provision for the appointment of Inspector of Registration Offices.
These appointments are to be made by the State Governments.
From the brief analysis of the provisions of the Act it is clear that the object of the Registration
Act is to preserve as authentic record of the terms of documents so that if a document be lost or
destroyed or misplaced, a certified copy from the Registrar can be obtained. Registration also
facilitates the proof of execution of a document as its execution is admitted by the executant,
before the Sub-registrar. Yet another useful purpose that registration serves is to enable any
person intending to enter into any transaction relating to immovable property to obtain complete
information relating to the title to such property and for this purpose to look into the register and
obtain certified copies of the documents.
Registration of sale of an immovable property creates a right in rem in favor of the buyer of the
property with exclusive possession of the property till the same is transferred. In case of lease,
the lessee enjoys the exclusive possession of property for a defined period.
Land or Property Registration greatly reduces risk of fraud and helps solve disputes easily, in
addition to creating and maintaining an up-to-date public record.



18 | P a g e

BIBLIOGRAPHY

BOOKS

Shukla S.N, The Transfer of Property Act, 26
th
edn.(2006), Allahabad Law Agency,
Faridabad.
Subba G.C.V Rao, Law of Transfer of Property, 6
th
edn.(2008), Alt Publications,
Hyderabad.
Subba G.C.V Rao, Transfer of Property Act, 15
th
edn.(2005), C.Subbiah Chetty & co.,
Chennai.
Saxena Poonam Pradhan, Property Law, 2
nd
edn.(2011), Lexis Nexis, New Delhi.
Singh Avtar, The Transfer of Property Act, 2
nd
edn.(2009), universal Law Punblishing
Co., New delhi.
Sinha R.K., The Transfer of Property Act, 14
th
edn.(2013), Central Law agency,
Allahabad.


WEBSITES

http://www.caclubindia.com/articles/need-and-importance-of-property-registration-
17702.asp#.UlQxd1Cmgts

http://www.joneslanglasalleblog.com/realestatecompass/real-estate/2011/04/basics-property-
registration/

http://www.indianexpress.com/news/the-basics-of-property-registration/776781/

http://www.commonfloor.com/guide/registration-of-property-is-compulsory-5883.html

http://www.doingbusiness.org/data/exploreeconomies/india/registering-property/