Law on Fraud | Registration of document by public officer while discharging public duty: A Fraudulent activity? AP HC decides

Andhra Pradesh High Court: M. Satyanarayana Murthy, J., expressed that,

“If a party to the document wants to annul the document, he has to file a suit under Section 31 of the Specific Relief Act before the competent Civil Court and if, third party wants to annul the document, he has to approach the competent Civil Court and seek relief under Section 34 of the Specific Relief Act.”

Murthy and Sodemma were husband and wife with no children. Murthy was the absolute owner of agricultural land and a house, he had alienated his entire property to his wife during his lifetime.

Sodemma who was the maternal aunt of the petitioner, bequeathed the said property to him as he had taken care of their welfare at the old age. Therefore, petitioner became the absolute owner and possessor of the said property as per the registered Will deed executed by Sodemma.

Respondent 15, son of younger brother of Murthy with a mala fide intention to become the owner of Murthy’s property hatched a plan and fabricated an adoption deed to claim that Murthy and Sodemma adopted respondent 14 and got the signature of Murthy and Sodemma on the said fabricated deed by fraud and misrepresentation.

Later, in the year 2002, respondent 15 fabricated unregistered agreement of sale on the blank stamp papers signed by Murthy having believed him.

Respondent 14 filed for partition of the above-mentioned property by claiming that he is adopted son of Murthy and Sodemma.

Respondent 15 also filed for specific performance of unregistered sale agreement alleged to have been executed by Murthy after lapse of more than 17 years from the date of alleged execution of the said unregistered agreement. Murthy and Sodemma contested both the suits and denied the execution of both the fabricated adoption deed dated 24.05.1993 and alleged unregistered agreement of sale.

Further, it was submitted that during the pendency of both the said suits, respondent 17, the then Minister for Animal Husbandry alleged to have purchased the property, which is the subject matter of those two suits, and started construction of palatial building in the subject property and he by abusing his power as the Minister for Animal Husbandry made the authorities concerned to issue antedated permissions in contravention of Rules.

This Court had directed that there shall not be any construction on the subject property.

Crux of the Matter

Alleged playing of fraud on Sub-Registrar in mutating the name of respondents 14 and 15,  registration of property in the name of respondent 16 allegedly at the instance of respondent 17.

Petitioners claim was that when the decree was passed, appeal were pending against both the decrees and common judgment, execution of sale deed by respondents 14 and 15 in favour of respondent 16 allegedly at the instance of respondent 17 deviating the decree was serious illegality and it amounted to ‘fraud’.

Tahsildar, respondent 8 was not supposed to mutate the names of respondents 14 and 15 and only due to influence of respondent 17.

Petitioner claimed that the very mutation of the name of respondents 14 and 15 in the revenue record, now mutated the name of respondent 16 after completion of sale transaction, registered document was tainted by ‘fraud’.

Analysis, Law and decision

To constitute fraud, there must be a suggestion, as a fact, of that which is not true, by one who does not believe it to be true; the active concealment of a fact by one having knowledge or belief of the fact; a promise made without any intention of performing it; any other act fitted to deceive; any such act or omission as the law specially declares to be fraudulent. 

In the present matter, Court stated that,

In the absence of any interim direction, registration of a document when presented for registration satisfying the requirements under the Stamp Act and Registration Act is justified.

 Court added that Registrar is bound to register the document presented for registration unless there is prohibition from registration of such document pertaining to the land covered by Section 22A, 35 (3) and Section 71 of the Registration Act. But no such ground was raised in the present matter.

In Court’s opinion, execution of registered sale deed by respondent 14 and 15 in favour of respondent 16 by playing fraud was purely a mixed question of fact and law, such a question cannot be decided in writ petition while exercising power under Article 226 of the Constitution of India.

Supreme Court in Satya Pal Anand v. State of M.P., AIR 2016 SC 4995, held that “a party aggrieved by registration of a document is free to challenge its validity before a competent Civil Court.”

High Court held that while exercising jurisdiction under Article 226, this Court cannot annul document on the ground of ‘fraud’ and ‘misrepresentation’ since they are both mixed questions of fact and law, such roving enquiry cannot be conducted by the Constitutional Court to issue a writ of Mandamus as it is an extraordinary and discretionary relief.

When the documents are presented for registration before the Sub-Registrar, his duty is to register the same subject to any bar contained in any law and satisfying the requirements under the provisions of the Stamps and Registration laws. Such registration of document is nothing but discharging public duty.

Therefore, registration of document while discharging public duty by public officer cannot be said to be fraudulent act and such act will not attract the definition of fraud under Section 17 of the Indian Contract Act.

When can a document be cancelled?

It is settled law that the document can be cancelled only by filing suit before the Civil Court under Section 31 of the Specific Relief Act by a person, who is a party to the document.

If a third party intended to annul the document, he has to file a suit to declare the suit document as illegal and not binding on the plaintiff.

Due to lack of merits, no relief was granted and petition was dismissed.[Mangipudi Nagaraju v. State of Andhra Pradesh, 2021 SCC OnLine AP 3148, decided on 8-10-2021]

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