The Allahabad High Court, in a significant ruling, has upheld the refusal of a Sub Registrar to register an agreement to sell a property located within a cantonment area without a No-Objection Certificate (NOC) from the concerned defence authorities. A Division Bench of Justice Shekhar B. Saraf and Justice Praveen Kumar Giri dismissed a writ petition filed by one Ahmad Ali Khan, holding that an attempt to transfer such property through an agreement to sell, without prior permission, is a “colourable” method of doing what is directly prohibited by law. The court affirmed that its previous orders and government circulars mandating an NOC apply to all documents effecting a transfer, including agreements to sell.
Background of the Case
The petitioner, Ahmad Ali Khan, challenged an objection raised on October 26, 2012, by the Sub Registrar-IV, Sadar, Meerut. The Sub Registrar had refused to register an agreement to sell for Bungalow No. 132, Survey No. 56, British Calvary (B.C.) Lines, Bungalow Area, Meerut Cantt.
The refusal was based on two orders of the Allahabad High Court—Cantonment Board, Varanasi vs. State of U.P. and others (2010) and Virendra Kumar and Others vs. State of U.P. and others (2010)—and a subsequent circular issued by the Uttar Pradesh government on February 21, 2011. These directives prohibited the registration of any instrument transferring property within a cantonment area without an NOC from the Defence Estate Officer. The Sub Registrar’s objection stated, “…registration of any document like sale-deed, gift-deed, lease, agreement etc. relating to properties situated in Meerut Cantt is not being done in this office since 03-03-2011 without NOC/permission issued by Meerut Cantt Board, Meerut/Defence Estate Officer, Meerut Cantt…”
The petitioner had entered into an agreement to sell the “old grant rights” of the bungalow’s superstructure to Sri Ajay Gupta and Smt. Parul Gupta for a consideration of Rs. 45 lakhs, having received an advance of Rs. 25 lakhs.
Petitioner’s Arguments
Mr. Vinayak Mithal, counsel for the petitioner, argued that the Sub Registrar’s action was illegal and beyond the scope of the Registration Act, 1908. The key contentions were:
- The agreement to sell pertained only to the superstructure of the bungalow, not the land, which was explicitly acknowledged in the agreement as being the property of the Government of India.
- The High Court orders and the government circular relied upon by the Sub Registrar prohibited the execution of deeds relating to land, not superstructures.
- An ‘agreement to sell’ does not constitute a ‘transfer’ of property under Section 54 of the Transfer of Property Act. Therefore, the prohibition on transfer without an NOC was not applicable.
- The document was compulsorily registrable under Section 17(1A) of the Registration Act, and the Sub Registrar had a duty to register it.
- The petitioner had purchased the rights via a sale deed in 2006 and had duly applied for mutation, thus discharging his obligations.
Respondents’ Contentions
Appearing for the respondents, Mr. Arimardan Singh Rajpoot, Additional Chief Standing Counsel, and Mr. Shashi Prakash Singh, Additional Solicitor General of India, assisted by Mr. Chandra Prakash Yadav, vehemently opposed the petition, arguing:
- Under Rule 15 of the Cantonment Land Administration Rules, 1937, no property in a cantonment can be transferred without the prior permission of the Central Government.
- The property is held under ‘Old Grant’ terms governed by the Governor General in Council’s Order No. 179 of September 12, 1836 (GGO-179), which has statutory force and requires prior sanction for any sale.
- The petitioner lacked a valid title, as the property was still recorded in the name of the original holders, Major Jaswant Singh Chatrath and Smt. Tirath Kaur, and the petitioner’s own mutation application was pending.
- The High Court’s order in the Cantonment Board, Varanasi case directed the Sub Registrar “not to register any document and not to execute any sale deed/lease deed” without an NOC, a directive broad enough to cover an agreement to sell.
- Allowing the registration of an agreement to sell would defeat the court’s intent, as parties could transfer possession and effectively complete the transaction without an NOC.
- The superstructure is on defence land and cannot be treated as a separate entity.
Court’s Analysis and Decision
The High Court, after perusing the material on record and hearing the parties, dismissed the writ petition. The bench, authored by Justice Praveen Kumar Giri, concluded that the Sub Registrar was bound by the previous High Court orders and the consequent government circular.
The Court held that the petitioner’s argument distinguishing between the superstructure and the land was unsustainable. It observed, “the superstructure in question is on defence land and it cannot be treated as a separate entity.” The judgment cited the definition of ‘building site’ under Rule 2(c) of the Cantonment Rules, 1937, which includes adjacent open ground, thereby integrating the building with the land it occupies.
Applying the legal maxim ‘quando aliquid prohibetur ex directo, prohibetur et per obliquum’ (what cannot be done directly, cannot be done indirectly), the Court found that the petitioner was attempting to circumvent the law. It stated, “in the present case, the petitioner has attempted to do indirectly what he cannot do directly in a colourable manner.”
The bench reasoned that an agreement to sell is a precursor to a sale and can lead to a transfer of property through legal proceedings for specific performance under Section 53A of the Transfer of Property Act. “An agreement which, in substance, transfers possession, consideration, and incidents of ownership without prior NOC, is a colourable action, void ab initio, and unenforceable under Section 23 of the Contract Act,” the Court observed.
Furthermore, the Court pointed out that the petitioner had not challenged the validity of the government circular or the previous judicial orders. It also noted that the petitioner had an alternative statutory remedy of filing an appeal before the Registrar under Section 72 of the Registration Act against the Sub Registrar’s refusal.
Concluding the judgment, the Court remarked that the government’s restriction was passed “keeping in mind national interest and the security threat to the assets of the army and to the army personnel staying in the cantonment area.”
In light of these findings, the writ petition was dismissed as not maintainable, with the petitioner directed to avail the appropriate remedy if desired.
