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CS Professional · Drafting, Pleadings and Appearances · Drafting of Agreements, Deeds and Documents

Vikram agrees to sell his shop to Deepak and the deed is duly registered. Earlier, Vikram had orally agreed to sell the same shop to Farhan, but possession was never delivered to Farhan. Which position follows under the Registration Act, 1908?

The registered deed prevails. Under section 48 of the Registration Act, a duly registered non-testamentary document takes effect against any oral agreement relating to the property unless the oral agreement was accompanied or followed by delivery of possession constituting a valid transfer. Farhan never received possession.

  1. AThe oral agreement with Farhan prevails because it came first
  2. BBoth prevail equally and the shop must be divided
  3. CThe registered deed takes effect against the oral agreement, since the oral agreement was not accompanied or followed by delivery of possessionCorrect
  4. DThe registered deed is void because an oral agreement existed

Explanation

Section 48 provides that non-testamentary registered documents relating to property take effect against oral agreements or declarations, unless the oral agreement was accompanied or followed by delivery of possession that constitutes a valid transfer. Farhan never got possession, so the exception does not apply. The registered deed in favour of Deepak therefore prevails.

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