Revenue officials cannot decide property title through mutation entries; Punjab and Haryana HC orders recording disputed claims and fixing personal liability for wrongful entries

The respondents-plaintiffs sought a declaration that they were owners in possession of 55/192 share, equivalent to 122 kanals 17 marlas, in the suit land.

Their claim was founded on a compromise decree dated 25 April 1975, passed in earlier litigation between them and defendants No.1 to 10, under which the plaintiffs were declared owners of 55/192 share and defendants No.1 to 5 of the remaining 137/192 share.

The plaintiffs also challenged mutation No.403 dated 22 July 1973, which had been sanctioned in favour of defendants No.4 and 5 on the basis of an earlier judgment dated 27 July 1969 that had already been set aside in appellate and remand proceedings.

The appellant purchased 7 kanals 7 marlas from defendants No.4 and 5 through sale deed dated 5 March 1981 and claimed protection as a bona fide purchaser for value without notice.

The trial Court decreed the plaintiffs’ suit, and the first appellate Court affirmed the decree on all material issues.

The present second appeal was filed by the legal representative of defendant No.13, a subsequent purchaser.

Whether the compromise decree dated 25 April 1975 conclusively established the plaintiffs’ ownership of 55/192 share in the suit property and bound the subsequent purchasers?

Whether mutation No.403 dated 22 July 1973, based on a judgment that had already been set aside, could confer title upon defendants No.4 and 5 or validate their subsequent transfers?

Whether the appellant was a bona fide purchaser for consideration without notice and could claim protection against the plaintiffs’ prior rights?

Whether the concurrent findings of the Courts below warranted interference in second appeal?

The Court applied Order XXIII Rule 3-A of the Code of Civil Procedure, 1908, under which the validity of a compromise decree cannot be challenged through an independent suit and must be questioned before the Court that recorded the compromise.

A compromise decree is binding upon the parties to it and, subject to the rights legally available to them, binds their successors-in-interest.

A transferee cannot acquire a better title than that possessed by the transferor.

The defence of bona fide purchase requires proof of good faith, due inquiry, and reasonable diligence, particularly where the title documents or revenue entries disclose circumstances requiring further investigation.

The Court further relied on the settled principle, reaffirmed in Jitender Singh v. State of Madhya Pradesh, 2021 (4) RCR (Civil) 883, and the authorities cited therein, including Balwant Singh v. Daulat Singh, (1997) 7 SCC 137, and Suraj Bhan v. Financial Commissioner, (2007) 6 SCC 186, that mutation entries are made for fiscal purposes and neither create nor extinguish title; questions of title fall within the jurisdiction of civil courts.

The same principle was reiterated with reference to Jamnabai v. Vasudev, SLP (C) No.39 of 2026, decided on 20 August 2026.

The High Court held that the compromise decree of 25 April 1975 finally determined the respective shares of the plaintiffs and defendants No.1 to 5.

The original defendants against whom the decree operated did not successfully challenge it under Order XXIII Rule 3-A CPC; defendants No.4 and 5 ultimately withdrew their second appeal, while the other concerned defendants accepted the result.

As the appellant derived her title from defendants No.4 and 5, she could not assert a title superior to theirs or collaterally challenge the compromise decree.

Mutation No.403 was legally unreliable because it was founded on the 1969 judgment, which had already been set aside before the mutation was sanctioned.

The appellant also failed to establish bona fide purchase: the mutation itself referred to the earlier judgment, and reasonable diligence would have required her to investigate the pending appellate proceedings and the subsequent compromise decree.

Since defendants No.4 and 5 held only 137/192 share, they could transfer no greater interest, and their sale could not prejudice the plaintiffs’ 55/192 share.

The Court upheld the concurrent findings that the respondents-plaintiffs were owners in possession of 55/192 share of the suit property and that the appellant was not a bona fide purchaser entitled to protection.

The Court reiterated that mutation entries do not confer title and directed the revenue authorities to properly record sale deeds, gifts, wills, and court orders, while referring disputed title questions to the competent civil courts rather than deciding them administratively.

Pending applications, if any, were also disposed of.