Rowland, J.This is an appeal by plaintiffs 1, 2 and 3 who had sued for specific performance of a contract into which, it is said, defendant 6 had entered with these plaintiffs to give them a mokarrari lease of 8 cottahs 6 dhoors of land. This land was part of an area of 16 cottahs 7 dhoors which was the site of a market in village Musehari. The landlords of the village were Shamnarain Singh and Basudeo Prasad Singh who each held eight annas and on partition between them in 1916 Basudeo Prasad Singh became exclusively entitled to 8 cottahs 1 dhoor and Shamnarain to 8 cottahs 6 dhoors of the market land. The share of Basudeo Prasad including 8 cottahs 1 dhoor of the bazar land was purchased by the plaintiffs on 21st May 1926.

2. The share of Shamnarain Singh including the 8 cottahs 6 dhoors of the bazar land was bought at an auction sale by defendant 6, Rambhawan Singh. The above facts are common ground. The plaintiffs alleged that Rambhawan in December 1927 entered into negotiations with the plaintiff and agreed to give them a mokarrari of these 8 cottahs 6 dhoors on a salami of Rs. 200, and a nominal rent of four annas a year; that this was agreed between the parties on 21st December 1927 and that a document embodying the agreement was executed on 22nd December 1927.

3. It is for specific performance of this agreement that the suit was brought. It is said that defendant 6 was at the time in need of money as certain property of his was being put up for sale in execution of a decree, the date fixed being 22nd December 1927. Defendant 6 at or about the same time was negotiating with Harbana Singh, defendant 5, to raise money by a usufructuary mortgage of his eight annas share in the village. On 22nd December 1927 stamp papers were bought by defendant 6 of which one bearing a stamp of Rs. 20 was destined for the usufructuary mortgage in favour of defendant 5 and the other bore a stamp of Rs. 2-8-0 and it was the plaintiffs case that this was intended for the execution of the mokarrari lease in their favour.

4. The plaintiffs alleged payment on 22nd December 1927 of the entire nazarana of Rs. 200 which it is said was utilised in satisfying the decree against Rambhawan and saving his property from being sold. Rambhawan on that same day executed a mokarrari deed and affixed his thumb impression and made it over to the plaintiffs but by one pretext or another put off registering it. Thereafter it is said that defendant 5 brought defendant 6 into collusion with himself, and on 15th February 1928 procured defendant 6 to execute a mokarrari deed on a salami of Rs. 800 in favour of defendants 1-4 of whom according to the plaintiffs defendant 1 was a servant of defendants 5 and 6. A stamp valued at Rs. 9 for this document was bought on 15th February 1928, and the document executed on that same day. The zerpeshgi in favour of defendant 5 was executed on 16th February and both documents were registered on 27th February 1928.

5. It is alleged that so far as the mokarrari was concerned, the transaction was done collusively with knowledge of the plaintiffs prior contract and with the intention of defrauding the plaintiffs. The suit was instituted on 20th December 1928. Defendant 6 did not contest the suit; defendant 5 denied all the allegations regarding the contract and defendants 1-4 took a similar position. The suit was decreed by the Munsif, but this decision was reversed and the suit dismissed by the Subordinate Judge. The Munsif had held that the document dated 22nd December 1927 propounded by the plaintiffs was not admissible in evidence but that by oral evidence and in the light of the circumstances the plaintiffs had proved the contract alleged by them. Therefore he gave the plaintiffs a decree. The Subordinate Judge agreed with the view of the Munsif that the mokarrari deed of the plaintiffs being unregistered was inadmissible in evidence. He examined the rest of the evidence propounded by the plaintiffs and the circumstances of the case and held the story of the plaintiffs to be improbable and the evidence in support of it unsatisfactory. It is contended and the contention is irresistible that if the Subordinate Judge had admitted in evidence this document, there is possibility amounting to probability that his decision on the merits might have been otherwise; and it is therefore of importance to consider whether he was right in refusing to admit the document as evidence.

6. In Uma Jha Vs. Chetu Mander and Others, a Division Bench of this Court gave a decree for specific performance of a contract of sale admitting in evidence an unregistered document expressed to be a sale deed. The suit was instituted for a direction to the defendants to register the kobala, but the decree was given for the execution and registration of a fresh document within three months from the date of the order. Das, J., observes:

I know of no authority which decides that an agreement for sale has to be registered under the Registration Act. The true view is that although a kobala which had not been registered is inoperative as a kobala, yet it is admissible in evidence in a suit to enforce specific performance of the contract which must be deemed to have preceded the execution of the kobala.

7. This decision follows Surrendra Nath v. Gopal Chandra (1910) 8 1 C 794 where Mookherji, J., accepted the argument presented to him that:

the mere execution of a lease by the defendants did not convert the executory contract into an executed contract; that the agreement between the parties was that the defendants would execute in favour of the plaintiff a lease and register it so as to make it an instrument operative in law and that the mere execution of the document which was never registered by reason of the default of the defendants was not complete performance of the contract.

If I understand correctly the reasoning of these decisions, it would seem to have been held that where parties enter into a contract for a transfer of immovable property and a deed is executed, even then until the contract is fulfilled by registering the deed it does not require registration and the unregistered deed can be proved. It would seem to follow that the requirement of law that certain dealings with land must be registered and failing that, they will be void, is entirely nugatory because such dealings so long as they remain unregistered are not to be considered complete so as to come within the bar of the statute, and once registered they are relieved from it as having fulfilled the requirement of the law.

8. The penalty attaching to non-fulfillment of the laws demand for registration would on this view never attach to any document whatever so as to preclude its being used to prove a contract embodied in it. This is a surprising proposition. But in Surendra Nath Nags case (1910) 8 1 C 794 a number of authorities are collected in support of such a view of the law. The Judges of the Calcutta High Court however were not unanimous as will be seen by referring to Sanjib Chandra v. Santosh Kumar AIR 1922 Cal 436 . This was a suit for specific performance and the contract had been reduced into a written instrument dated 15th January 1917 which however was unregistered. It purported to be a lease for five years. Rankin, J., held that the unregistered document was inadmissible in evidence for the purpose of proving the agreement sought to be specifically enforced and that apart from the said document, it was not open to the Court to find any prior or independent oral agreement. Rankin, J., saw no escape from the plain words of Section 17(1) and Section 49, Registration Act. And in the Patna High Court there is authority in (Maharani) Janki Kuer Vs. Birj Bhikhan Ojha and Others, for a similar view.

9. A lease from year to year or for any term exceeding a year if reduced to writing requires registration u/s 17, Registration Act, and if unregistered cannot be used in evidence u/s 49 of the same Act to prove any transaction affecting the property. The document being excluded, Section 91, Evidence Act, would come into operation so as to preclude oral and other evidence of its terms from being given.

In that particular case the party propounding the unregistered lease was in fact in possession and the lease was permitted to be used for a collateral purpose, that is to say for explaining the nature of his possession. It was only to this limited extent and for this limited purpose that the document was admitted. The authorities in India were thus conflicting, when the Privy Council decision in Dayal Singh v. Indar Singh AIR 1926 PC 94 was pronounced.

10. The document in question was an agreement for the sale of certain immovable property embodying an acknowledgment of receipt of a part of the consideration money. Now it has been explained in the concluding sentence of Section 54, T.P. Act, that a contract for sale of immovable property does not of itself create any interest in or charge on such property and the Courts in India had for a long time been agreed in recognising unregistered documents embodying contracts for sale of immovable property as being documents not of themselves creating any interest in or charge on such property but merely documents entitling the holder within the meaning of Section 17(2), Part (5), to obtain another document which will when executed create or declare, etc., a right and title in land.

11. The Courts had treated such documents as admissible even in cases where at the time of execution of the document earnest money had been paid and was acknowledged in the document itself. Unfortunately it escaped notice that Section 55(6), T.P. Act, gives the transferee a right to a charge on the property for his earnest money and the Privy Council holding that to this extent the agreement to sell created an interest in immovable property found that such a document needed to be registered and for want of registration was inadmissible in evidence. The result of this decision was that in 1927 the legislature took action by amending the Indian Registration Act so as to add an explanation to Sub-section 2, Section 17, whereby a contract for sale of immovable property is not to be deemed to require registration merely because it acknowledges receipt of part or all of the purchase money.

12. Within about a year after this amendment, came the decision in James R.R. Skinner v. Robert Herculus Skinner AIR 1929 PC 269 . The document before their Lordships contained words expressed to be an absolute conveyance and contained also a promise to execute a registered document if required. The suit was for specific performance of the agreement of sale and for possession of the property; and the principal issue in the case was whether the document was admissible in evidence. The Board formulated two questions: first, whether the document comes within the provisions of Section 17, Registration Act, and so required registration; and secondly, whether if registration was necessary it could form the basis of a suit for specific performance, notwithstanding the provisions of Section 49. On the first question their Lordships held that the document was a sale deed requiring registration.

13. In dealing with the second point they held that a document hit by Sections 17 and. 49 could not be used as evidence of a contract to sell, or as the basis of a suit for specific performance. This I think is the essential point that their Lordships intended to lay down. They cited with approval Sanjib Chandra Sanyal Vs. Santosh Kumar Lahiri and Others, where Rankin, J., had said:

If I admit the document at all, it seems to me that I would be receiving it as evidence of a transaction affecting the property. If upon its true construction, it is meant to take effect as a present demise, I cannot treat it as something else or as evidence of a transaction different in nature and so avoid the statute.

14. At any rate, this much their Lordships did lay down and it is sufficient authority for me to say that in the case before me the document is within the mischief of Sections 17 and 49 and cannot be used as evidence of an agreement to sell or as a foundation of a suit for specific performance. A passage in their Lordships judgment has been much discussed and I think misunderstood, where it is said:

An agreement for the sale of immovable property is a transaction "affecting" the property within the meaning of the statute inasmuch as, if carried out, it will bring about a change of ownership.

I believe their Lordships merely intended to restate as a general proposition the principle which was applied in a particular case by Rankin, J. They cannot have meant to obliterate the distinction he had drawn between "a present demise" and a transaction different in nature."

15. It has however been supposed by many that their Lordships have laid down that an agreement for sale itself is hit by Sections 17 and 49. It seems to be an amazing suggestion that their Lordships could conceivably ignore both Section 54, T.P. Act, and the explanation added in 1927 to Section 17, Registration Act, and can only have been entertained by those who had not studied Ramling Parvataya Samble Vs. Bhagvant Sambhuappa, which their Lordships cite with approval. There the Bombay High Court held that the document before them was not a deed of sale but an agreement to sell; that it was not hit by Sections 17 and 49, and that it could be used as the basis of a suit for specific performance and as evidence of the agreement to sell; and this, notwithstanding that it contained a recital of receipt of the consideration money.

16. The confusion I think arises from failure to realize that the word "affecting" in Section 49 is not one of the words used in Section 17 to describe documents that ought to be registered. If the difference in language is remembered there need not, I think, be any real difficulty. In Jagannadha Rao v. Lakshminarayana AIR 1930 Mad 683 it is said:

I do not think that ... every agreement for sale of immovable property should be treated after the decision of the Privy Council, to be an agreement affecting immovable property within the meaning of Section 49.

If the learned Judge instead of using the words "agreement affecting immovable property" had said "agreement hit by Sections 17 and 49" or had said "document creating any title in immovable property" he would have I think expressed accurately their Lordships intention. In other decisions it may have been thought that their Lordships went further; but it does not seem to have been doubted that at any rate their Lordships held this much that a document hit by Section 17 could not be used except in accordance with Section 77, Registration Act, to support a suit for specific performance. That was what was decided in Komiresetti Satyanarayana Vs. Yeeranki Chinna Venkatarao and Others, . Between the years 1927 and 1929 special Committee of the Indian legislature was engaged in examining proposed amendments to the Transfer of Property Act and other connected Acts bearing on the same subject.

17. In this connexion the committee had before it a proposal to amend Section 49, Registration Act, and the Special. Committee reported:

We propose that Sections 48 and 49 should be amended to empower Courts to admit unregistered documents in evidence in giving effect to the doctrine of part performance: Gazette of India, dated 20th August 1927, Part 5, p. 103.

18. The Select Committees report on this section (Gazette of India, dated 9th March 1929, Part 5, page 42) is in identical terms. In the notes on clauses, it is said:

Section 49 enacts that a document which is required to be registered and is not registered, cannot be received in evidence. It has been held by the Judicial Committee that such documents, although not admissible for the purpose of proving the transaction purported to have been effected by them are admissible in evidence for collateral purposes, such as for ascertaining the nature of possession: Varada Pillai v. Jeevarathnammal AIR 1919 PC 44. In giving effect to the doctrine of part performance when transactions are not complete owing to the omission of registration, it is necessary that Courts should be empowered to admit them in evidence for the purpose of proving part performance. A proviso has accordingly been added to the section: (Gazette of India, dated 9th March 1929, Part 5, p. 75).

19. These extracts, do not read as if the Committee regarded themselves as making any sweeping change in the law; but the proviso which was enacted by Section 10(3)(b), Act 21 of 1929, runs thus:

Provided that an unregistered document affecting immovable property and required by this Act or the Transfer of Property Act 1882, to be registered may be received as evidence of a contract in a suit for specific performance under Ch. 2, Specific Relief Act 1877, or as evidence of part performance of a contract for the purposes of Section 53-A, T.P. Act 1882, or as evidence of any collateral transaction not required to be effected by a registered instrument.

If the present case had to be determined on a reading of the law as so amended, it could be argued that the disputed document would have to be admitted in evidence. But the amendment cannot assist the plaintiffs whose suit was commenced before it came into force. Such proceedings are expressly saved by Section 15.

20. For the reasons above given, I have no doubt that the Subordinate Judge was right in treating the document as inoperative and inadmissible in evidence. He went on to discuss the other evidence and held that the plaintiffs had not succeeded in proving the fact of any such agreement having taken place. In the course of the discussion of the evidence he refers to certain discrepancies in the oral evidence; and in the memorandum of appeal it is pointed out that in some respects the references to the evidence are inaccurate. The decision however was based on the facts and circumstances in general and I do not think that the inaccuracies pointed out have made any difference to the decision of the case.

21. The circumstances and probabilities were very strongly against the plaintiffs, particularly the fact that the stamp paper used for the plaintiffs agreement was bought by defendant 6 on the same occasion on which he bought the stamp for usufructuary mortgage in favour of defendant 5, for which an explanation has been given by the defendants which the Subordinate Judge has accepted; and the fact that the plaintiffs took no steps to get the document compulsorily registered and did not bring their suit till 364 days after the alleged agreement.

The result is that the appeal is dismissed with costs. Leave to appeal is refused.