Dharmendra Singh & Anr. vs Fazlu Rehman

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* IN THE HIGH COURT OF DELHI AT NEW DELHI
% Order reserved on: 31.08.2026
Order pronounced on: 08.09.2026
Order uploaded on: 08.09.2026
# CNR No. DLHC010256322023
+ RFA (COMM) 134/2023
DHARMENDRA SINGH & ANR .....Appellants
Through: Mr. Shekhar Dasi, Mohd.
Talha, Mr. Ayush Dassi, Mr.
Deepesh Kasana and Mr.
Divyansh Malhotra, Advs.

versus

FAZLU REHMAN .....Respondent
Through: None.
CORAM:
HON'BLE MR. JUSTICE ANIL KSHETARPAL
HON'BLE MS. JUSTICE SHAIL JAIN
O R D E R
ANIL KSHETARPAL, J.
1. The present Appeal has been filed by the Plaintiffs (Appellants)
assailing the correctness of the Judgment and Decree dated
1
09.05.2023 , passed by the learned District Judge (LDJ), Saket Courts
Delhi, whereby the plaint seeking specific performance of Agreement
to Sell dated 10.05.2019, possession and recovery of money, came to
be rejected at the threshold under Order VII Rule 11(d) the Civil
Procedure Code, 1908 [hereinafter referred to as „CPC‟].
2. For the sake of convenience, the parties before this Court shall
be referred to in accordance with their status before the LDJ.

1
hereinafter referred to as „Impugned Judgment‟
Signature Not Verified
Signed By:JAI
NARAYAN
Signing Date:08.09.2026
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A. BRIEF BACKGROUND:
2
3. Pithily put, the parties herein entered into an Agreement to Sell
dated 10.05.2019 in respect of a Shop bearing No.113, admeasuring
3
16 sq. yds. situated at Sabzi Mandi, Okhla, New Delhi , for a total
consideration of Rs.12,00,000/-. Pursuant to the ATS, a General
Power of Attorney, Will, Possession Letter and Receipt were also
executed between the parties on 10.05.2019. The entire sale
consideration of Rs. 12,00,000/- was paid, and possession of the suit
property was delivered to the Plaintiffs.
4. However, since the Defendant was in occupation of the suit
property, the parties simultaneously executed a Rent Agreement dated
10.05.2019, whereby the Defendant was inducted as a tenant in the
suit property for a period of 11 months commencing from 11.05.2019,
at a monthly rent of Rs. 10,000/-. The Rent Agreement further
provided for enhancement of rent by 10% upon renewal.
Consequently, the physical possession of the suit property remained
with the Defendant in his capacity as tenant.
5. Against the aforesaid arrangement, the Defendant initially paid
the agreed rent, however, the payment of rent was discontinued from
May 2020, on account of the disruption occasioned by the COVID-19
lockdown. Thereafter, the Defendant resumed payment of rent at the
existing rate; however, he declined to execute a fresh Rent Agreement
or accept the proposed enhancement in rent. Payment of rent was
again discontinued from December 2021.

2
hereinafter referred to as „ATS‟
3
hereinafter referred to as „suit property‟
Signature Not Verified
Signed By:JAI
NARAYAN
Signing Date:08.09.2026
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6. Following which, the Plaintiffs terminated the tenancy by way
of notices dated 14.03.2022 and 05.04.2022. It was at this stage that
the Defendant denied the Plaintiffs‟ title to the suit property and
disputed the efficacy of the documents executed on 10.05.2019, in
particular the ATS.
7. Consequently, the Plaintiffs instituted a suit seeking specific
performance of the ATS, possession of the suit property and recovery
of arrears of rent/use and occupation charges. In response to which,
the Defendant filed its written statement, wherein he admitted his
signatures on the documents dated 10.05.2019. However, any right or
title of the Plaintiffs in the suit property was disputed by him.
8. Thereafter, the LDJ framed a preliminary issue as to, „ Whether
the agreement to sell dated 10.5.2019 relied upon by the plaintiffs
cannot be looked into for want of registration and insufficiency of
stamp? If yes, whether the entire claim of the plaintiffs fails? ‟. While
answering the aforesaid question, the LDJ vide the Impugned
Judgment, rejected the plaint under Order VII Rule 11(d) of the CPC
having been insufficiently stamped and barred by Section 53-A of the
4
Transfer of Property Act, 1882 and Section 17 (1-A) read with
5
proviso to Section 49 of the Registration Act, 1908 , recording the
following conclusion:
“ 9.1. The preliminary issue is decided against the plaintiffs. The
agreement to sell dated 10.05.2019 which forms the basis of their
right is inadmissible for want of registration and insufficient
stamping. The removal of the defect regarding the stamping shall not
be sufficient as the document will still be inadmissible for want of

4
hereinafter referred to as „Act of 1882‟
5
hereinafter referred to as „Act of 1908‟
Signature Not Verified
Signed By:JAI
NARAYAN
Signing Date:08.09.2026
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RFA (COMM) 134/2023 Page 3 of 15

registration. The suit is barred by the provisions of the Transfer of
Property Act and Registration Act as discussed above. Therefore, the
plaint is liable to be rejected under Order VII Rule 11(d) of CPC. ”
9. Aggrieved by the above stated findings, the Plaintiffs have
approached this Court seeking our indulgence.
B. CONTENTION ON BEHALF OF THE PARTIES:
10. Learned counsel representing the Plaintiff, challenging the
Impugned Judgment has made the following submissions:
10.1 It is argued that the LDJ erred in applying Section 17(1-
A) of the Act of 1908 read with Section 53-A of the Act of 1882,
as the Plaintiffs are not in possession of the suit property but are
seeking possession thereof. These provisions protect a transferee
already in possession in part performance of a contract and,
therefore, have no application where the Plaintiffs claim no such
protection.
10.2 It is further urged that the LDJ failed to consider the
proviso to Section 49 of the Act of 1908, which permits an
unregistered document to be received in evidence in a suit for
specific performance, as evidence of part performance under
Section 53-A of the Act of 1882, or for a collateral transaction.
Thus, registration of ATS was not a mandatory pre-condition for
maintaining the suit for specific performance.
10.3 It is his case that the LDJ also erred in rejecting the plaint
under Order VII Rule 11(d) of the CPC, as the objection related
only to the admissibility of evidence and did not constitute a
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Signed By:JAI
NARAYAN
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statutory bar to the suit. Reference in this regard is also made to
Section 9 of the CPC, to argue that civil courts have jurisdiction
over all suits of a civil nature unless expressly or impliedly barred,
and no such bar arose in the present case.
10.4. It has further been stated that the Defendant‟s admission
pertaining to his signature on ATS and the Rent Agreement, shifts
the onus onto him to prove that they were signed in blank, a
disputed issue that could not have been decided at the threshold
without evidence.
10.5 Lastly, it is his case that the LDJ failed to appreciate that
Section 3 of the NCT of Delhi (Recognition of Property Rights of
Residents in Unauthorized Colonies) Act, 2019 recognizes
documents such as ATS, GPA and Will as conferring valid
title/ownership, notwithstanding the Act of 1908, Stamp Act,
6
1899 or other rules and regulations.
11. Learned counsel representing the Defendant was not present
during the course of final hearing before this Court. However, written
submissions dated 01.05.2024 had been filed on behalf of the
Defendant. Accordingly, we proceed to consider the submissions
contained therein, which are as follows:
11.1 It is the Defendant‟s case that the Plaintiffs have taken
mutually inconsistent pleas in the plaint. On the one hand they
claim ownership and delivery of possession pursuant to the ATS,
while on the other hand, it is their claim that the Defendant was

6
hereinafter referred to as „Act of 1899‟
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NARAYAN
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inducted as a tenant and as such is liable to be evicted. Such pleas

taken are argued to be „blowing hot and cold‟, thereby estopping
the Plaintiffs under the doctrine of election from approbating and
reprobating the same transaction.
11.2 It is his case that the ATS, being unregistered and
insufficiently stamped, required registration under Section 17(1-A)
of the Act of 1908, particularly since the Plaintiffs pleaded
delivery of possession thereunder. Further, it is stated that the LDJ
has rightly impounded the ATS under Section 33(1) of the Act of
1899 and referred it to the Collector of Stamps for adjudication.
11.3 Lastly, it is urged that Section 53-A of the Act of 1882
operates only as a defence and creates no independent enforceable
right. Further, under Section 17(1-A) of the Act of 1908, a
document relied upon for the purposes of Section 53-A must be
registered; an unregistered document has no effect for such
purposes.
C. ANALYSIS:
12. Heard learned counsel representing the parties and with their
able assistance perused the paperbook.
13. At the outset, it may be noted that the rejection of plaint by LDJ
under Order VII Rule 11(d) of the CPC proceeded on two broad
findings: firstly , that the ATS was compulsorily registrable under
Section 17(1-A) of the Act of 1908 read with Section 53-A of the Act
of 1882, and being unregistered, could not be looked into; and
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NARAYAN
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secondly , that the ATS was insufficiently stamped, and even upon
curing the stamp deficiency, would remain inadmissible for want of
registration. Both limbs of this reasoning, in the considered view of
this Court, do not withstand scrutiny.
Re: Non-registration
14. Insofar as registration of ATS is concerned, we do not find
merit in the interpretation placed by the LDJ on Section 53-A of the
Act of 1882 and Section 17(1-A) read with Section 49 of the Act of
1908. In this regard, a reference may be made to the Division Bench
Judgment of the Punjab and Haryana High Court in Ram Kishan and
7
Anr. v Bijendra Mann alia Vijendra Mann and Ors , wherein the
Court was dealing with an issue as to whether an unregistered
agreement to sell accompanied by delivery of possession or executed
in favour of a person already in possession, could form the basis of a
suit for specific performance.
15. The Court while examining the aforesaid provisions, held that
following the Registration and Other Related laws (Amendment) Act,
8
2001 , an agreement falling within the scope of Section 53-A of the
Act of 1882 is compulsorily registrable under Section 17(1-A) of the
Act of 1908. Consequently, an unregistered agreement cannot be
relied upon to claim the protection of part performance under Section
53-A of the Act of 1882.
16. However, the Court clarified that non-registration does not bar a

7
2012 SCC OnLine P&H 19839
8
hereinafter referred to as „Amendment Act of 2001‟
Signature Not Verified
Signed By:JAI
NARAYAN
Signing Date:08.09.2026
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suit for specific performance. In particular, the proviso to Section 49
of the Act of 1908, which also came to be introduced by way of
Amendment Act of 2001, expressly permits an unregistered document
to be received in evidence as proof of a contract in a suit for specific
performance. Thus, while an unregistered agreement cannot be relied
upon to claim the protection under Section 53-A, it may nevertheless
form the basis of a suit for specific performance and be received in
evidence for proving the contract.
17. Accordingly, it was held by the Court that an unregistered
agreement to sell involving part performance or possession can form
the basis of a suit for specific performance and can be admitted in
evidence, but it cannot be used to obtain the protection available under
Section 53-A of the Act of 1882. Thus, in view of the judgment and
findings rendered in Ram Kishan (Supra) , the reliance placed by the
LDJ on non-registration as a bar to the present suit is misplaced.
Re: Insufficiency of stamping
18. The second limb of the Impugned Judgment, proceeding on the
premise of ATS being insufficiently stamped, thereby making it
inadmissible even upon curing the stamp deficiency for want of
registration, also does not withstand scrutiny. Inasmuch as
insufficiency of stamping, by itself, cannot furnish a ground for
rejection of plaint under Order VII Rule 11(d) of the CPC.
19. The LDJ in the Impugned Judgment appears to have conflated
three distinct concepts: (i) the admissibility of an instrument in
evidence; (ii) the curability of a defect relating to stamp duty; and (iii)
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Signed By:JAI
NARAYAN
Signing Date:08.09.2026
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the maintainability of the suit itself. These concepts operate in
different statutory fields and cannot be treated as interchangeable for
the purposes of Order VII Rule 11(d) of the CPC.
20. The LDJ while coming to the conclusion highlighted under
9
paragraph no.8, has relied upon State of A.P. v P. Laxmi Devi , to
hold that the payment of duty is mandatory under Section 33 of the
Act of 1899. However, the reliance so placed by the LDJ is misplaced,
inasmuch as the Supreme Court therein, was not examining the
mandatory nature of stamp duty, rather the mandatory impounding of
an instrument, if brought before the concerned authority.
21. In the ordinary course, an instrument found to be insufficiently
stamped is required to be impounded under Section 33 of the Act of
1899, for further adjudication and recovery of the deficient duty.
However, this Court is of the view that relegating the Plaintiffs to that
route would serve no purpose and would only occasion avoidable
delay.
22. In this regard, a reference is made to proviso (a) to Section 35
of the Act of 1899, which itself constitutes the Court, being the
authority before whom the instrument is sought to be acted upon, as
competent to receive the instrument in evidence upon the insufficient
stamp duty being made good together with the prescribed penalty.
23. In view thereof, the appropriate course of action to be adopted
by the LDJ was to direct payment of the deficit stamp duty and
penalty as a condition for admissibility, rather than embarking upon

9
(2008) 4 SCC 720
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Signed By:JAI
NARAYAN
Signing Date:08.09.2026
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the separate impounding procedure contemplated under Section 33(1)
of the Act of 1899.
24. Reference in this regard is made to the judgment of Supreme
10
Court in Avinash Kumar Chauhan v Vijay Krishna Mishra , and
11
Omprakash v. Laxminarayan , both of which recognise that the
requirement of instruments being duly stamped can be satisfied by
payment made before the Court itself, by virtue of it being an
authority to receive a document in evidence. Thus, the implication
which follows therefrom is that not every instrument necessarily needs
to be routed through external adjudicatory mechanisms, particularly,
when the Court also have the authority to do so.
25. Turning now to the determination of quantum, the ATS,
undisputedly, involves delivery of possession pursuant to the ATS.
Article 23-A of the Schedule-I to the Act of 1899, as applicable to
Union Territories, provides that 90% of the stamp duty payable on a
conveyance covered under Article 23 is leviable, where such
conveyance is in the nature of part performance of a contract for
transfer of immoveable property, which reads as under:-
“ARTICLE 23-A
CONVEYANCE IN THE NATURE OF PART PERFORMANCE
Description of Instrument Proper Stamp-duty
Ninety per cent of the duty as a
Conveyance (No.23)]
[Art. 23A. CONVEYANCE IN THE
NATURE OF PART
PERFORMACNE . Contracts for the
transfer of immoveable property in the

10
(2009) 2 SCC 532
11
(2014) 1 SCC 618
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Signed By:JAI
NARAYAN
Signing Date:08.09.2026
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nature of part performance in any
Union territory under section 53A of
the Transfer of Property Act, 1882 (4 of
1882)
NOTES
Agreement for sale contemplating delivery of possession is
compulsorily registerable under clause (b) to sub-section (1) of
s. 17 of the Registration Act, 1908.”
26. In the present case, the ATS falls within the definition of a
conveyance in the nature of part performance, as it records delivery of
possession upon payment of entire sale consideration. Further, a set of
documents namely, a GPA, Will, Possession Letter and Receipt were
also executed. The Plaintiffs do not dispute that the possession was
delivered pursuant to ATS.
27. The aforestated set of documents are executed in order to avoid
execution of the Sale Deed and avoiding the corresponding liability to
pay stamp duty. It is for this reason that the Amendment Act of 2001
was introduced, while making such Agreement for Sale,
contemplating delivery of possession, to be compulsorily registerable.
28. In the present case, the suit is found to be maintainable on the
basis of the unregistered ATS solely on account of proviso to Section
49 of the Act of 1908. However, the Act of 1899 does not provide for
any such exception from payment of stamp duty. In fact, the total
payment of stamp duty remains the same. In order to ensure that the
proper stamp duty is paid, the incidence of 90% of the stamp duty
payable on the Conveyance Deed is shifted from the date of
Conveyance Deed to date of Agreement to Sell, which is in the nature
of conveyance evidencing delivery of possession for the purposes of
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NARAYAN
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part performance. Hence, in the present case, the Plaintiffs is found
liable to pay amount equivalent to 90% of the total stamp duty payable
at the time of execution of the ATS.
29. The Plaintiffs before this Court being a male and a female
jointly, the applicable rate of stamp duty is the concessional rate
prescribed for jointly held immovable property by a man and woman,
in terms of the Schedule-I to the Act of 1899 as substituted by the
Indian Stamp (Delhi Amendment) Act, 2007. The relevant
amendment, insofar as it pertains to Article 23, reads as under:
“ARTICLE 23
CONVEYANCE
Description of Instrument Proper Stamp-duty
[Art. 23 CONVEYANCE [as defined
by section 2(10)], not being a
TRANSFER charged or exempted under
No.62.
Three percent of the consideration
amount set forth in the instrument.
Further reduced to two percent in
respect of individually/jointly held
Immovable property by woman/women
(Provided that in cases of jointly held
immovable property, the reduced rate
of stamp duty shall apply only to the
share(s) held by woman/women)]
Exemption
Assignment of copyright under the
Copyright Act, 1957, Section 18
Co-Partnership-Deed, See Partnership
(No.46)

30. The aforesaid provision makes it clear that the concessional rate
of stamp duty applies only to the share held by a woman in a jointly
held immovable property. In the present case, since the respective
shares of the Plaintiffs have not been specified, their respective shares
are taken to be equal, i.e., 50% each, for the purpose of computation
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NARAYAN
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of stamp duty. Accordingly, such Duty is chargeable at the rate of 3%
on the 50% share held by the Plaintiff No.1 and at the concessional
rate of 2% on the 50% share held by the Plaintiff No.2, totalling upto
5%.
31. Thus, on the sale consideration of Rs. 12,00,000/-, the stamp
duty payable works out to Rs. 60,000/-. Against which, stamp duty of
only Rs. 50/- affixed on the ATS stands paid, resulting in a deficiency
of Rs. 59,950/-.
32. Insofar as the imposition of penalty is concerned, reference may
be made to the judgment of the Supreme Court in Peteti Subba Rao vs.
12
Anumala S. Narendra , wherein after interpreting Section 35 of the
Act of 1899, it was held that a Court, while performing the functions of
authority under the aforestated provision, does not have a discretion to
reduce penalty. Consequently, the Plaintiffs are made liable to pay
penalty equivalent to ten (10) times the deficient stamp, which shall be
a pre-condition for proceeding with the suit.
33. However, we may also note that the Supreme Court in H.C.
13
Dhanda Trust vs. State of Madhya Pradesh and Ors. , while
considering the scope of the power of Collector under Section 40(1)(b)
of the Act of 1899, held that the Collector has a discretion to impose a
penalty not exceeding ten (10) times the deficient stamp duty.
Accordingly, the Plaintiffs, upon depositing the deficient stamp duty
along with the penalty as directed hereinbelow, may file an appropriate
application before the Collector seeking refund of any part of the

12
2000 LawSuit(SC) 1869
13
2020 (9) SCC 510
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NARAYAN
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penalty in terms of Section 40(1)(b) of the Act of 1899. The said
application shall be considered by the Collector independently and in
accordance with law, having regard to the principles laid down by the
Supreme Court in H.C. Dhanda Trust (Supra).
34. Before parting, I must also acknowledge the valuable assistance
rendered by Sister Judge Manmeet Pritam Singh Arora, with whom I
discussed the matter. She was kind enough to share with me various
judgments passed by the Supreme Court that were of assistance in
deciding the issue.
D. OPERATIVE DIRECTION:
35. Thus, in view of the foregoing discussion, this Court directs the
Plaintiffs to deposit the deficient stamp duty of Rs. 59,950/-, together
with a penalty of Rs. 5,99,500/-, before the LDJ, within a period of
one (01) month from today, whereupon the ATS shall stand admitted
in evidence and suit would continue to proceed. However, the matter
shall be forwarded to the Competent Collector for determination of the
Plaintiffs entitlement, if any, to refund any part of the penalty in terms
of Section 40 of the Act of 1899, in exercise of her/his discretionary
power and in light of the principles laid down in H.C. Dhanda Trust
(Supra) without affecting the progress of the pending suit.
E. CONCLUSION:
36. In view of the foregoing discussion, the Impugned Judgment
and Decree dated 09.05.2023 passed by the LDJ is hereby set-aside.
Consequently, the present Appeal is allowed, the suit is restored to its
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NARAYAN
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original number and remanded to the LDJ for disposal in accordance
with law. All contentions of the parties on merits are left open.
37. Learned counsel representing the Plaintiffs/Appellants is
directed to appear before the LDJ, within a period of two weeks from
the date of this Order, for further proceedings in accordance with law.
38. Pending application(s), if any, shall also stand disposed of.

ANIL KSHETARPAL, J.

SHAIL JAIN, J.
SEPTEMBER 08, 2026
sp/hr
Signature Not Verified
Signed By:JAI
NARAYAN
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