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Supreme Court of India· 20 December 2024

When does limitation begin for cancelling a registered sale deed under Article 59 of the Limitation Act?

SHRI MUKUND BHAVAN TRUST AND ORS v. SHRIMANT CHHATRAPATI UDAYAN RAJE PRATAPSINH MAHARAJ BHONSLE AND ANOTHER
CIVIL APPEAL NO. 14807 OF 2024 · 2024 INSC 1025 · CIVIL APPEAL NO. 14807 OF 2024
Coram: Justice J.B. Pardiwala · Justice R. Mahadevan
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Answer

From the date of registration. Where a portion of the property has been conveyed by court auction and registered and another portion by a registered sale deed, there is a constructive notice from the date of registration and the presumption under Section 3 of the Transfer of Property Act comes into operation, possession itself operating as notice of title. The limitation period for setting aside the sale deed would start running from the date of registration and, as per Article 59 of the Limitation Act, 1963, after three years of the registration the plaintiff is barred from seeking cancellation of the registered sale deed or the decree.

Headnote

Code of Civil Procedure, 1908 — Or.VII r.11(d) — Or.XXIII r.3A — Limitation Act, 1963 — Art.59 — Art.65 — Transfer of Property Act, 1882 — s.3 — Rejection of plaint — Constructive notice — Code of Civil Procedure, 1908 — Or.VII r.11(d) — Plaint hopelessly barred by limitation — Held: Though limitation is generally a mixed question of law and facts, a plaint may be rejected under Order VII Rule 11(d) where a meaningful reading, after dissecting the vices of clever drafting creating an illusion of cause of action, shows the suit hopelessly barred. (¶18, 26) Limitation Act, 1963 — Art.59 — Transfer of Property Act, 1882 — s.3 — Limitation runs from registration — Held further: Registration operates as constructive notice and attracts the presumption under Section 3 of the Transfer of Property Act. Limitation for setting aside a registered sale deed runs from the date of registration and expires three years thereafter. (¶16, 20) Code of Civil Procedure, 1908 — Or.XXIII r.3A — Bar binds a stranger to the compromise — Held further: The bar under Order XXIII Rule 3A is applicable to third parties as well, so a stranger to the compromise cannot seek a declaration that the compromise decrees are void; the only remedy is to approach the same court. Appeal allowed; plaint rejected. (¶25, 27)

In the Court's own words
Paragraph 16When a portion of the property has been conveyed by court auction and registered in the first instance and when another portion has been conveyed by a registered sale deed in 1952, there is a constructive notice from the date of registration and the presumption under Section 3 of the Transfer of Property Act, comes into operation. The possession, in the present case, also has been rested with the appellant before several decades, which operates as notice of title. This Court in R.K. Mohd. Ubaidullah v. Hajee C. Abdul Wahab[^22], held as follows:
Paragraph 20As noted in the preceding paragraphs, the court auction was held in 1938 and sale deed was registered in the year 1952 in favour of the Defendant No.1 in respect of the suit properties, whereas, the suit was filed only in the year 2008, though the Respondent No.1 / Plaintiff and his predecessors were aware of the existence of the said registered sale deed of the suit properties. In fact, there is no averment in the plaint to the effect that the predecessors were not aware of the transactions. The limitation period for setting aside the sale deed would start running from the date of registration of the same and as per Article 59 of the Limitation Act, 1963, after three years of the registration, the Plaintiff is barred from seeking cancellation of the said registered sale deed or the decree that was passed before 50 years and the consequential judgements. We have already referred to Section 3 of the Specific Relief Act, 1963. The plaintiff, in our view, has miserably failed to ascertain the existence of the fact by being diligent. The question as to when a period of limitation would commence in respect of a registered document is no longer res integra. In this regard, this Court in Dilboo v. Dhanraji[^25], held as follows:
Acts & Sections
Or.VII r.11(d) Code of Civil Procedure, 1908Or.XXIII r.3A Code of Civil Procedure, 1908Art. 59 Limitation Act, 1963Art. 65 Limitation Act, 1963s.3 Transfer of Property Act, 1882s.31 Specific Relief Act, 1963

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Also decided in this judgment
Can a plaint be rejected under Order VII Rule 11(d) CPC when limitation is a mixed question?Does the bar under Order XXIII Rule 3A CPC apply to a stranger to the compromise decree?
Plain-language answer prepared by the LexStreak Editorial Desk — verify against the judgment. Source: Supreme Court of India. Corrections