No Cause Of Action To Cancel Sale Deed Curing Registration Defect: Delhi HC
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Subsequent removal of procedural deficiencies and obtaining a No Objection Certificate validates registration of a sale deed without creating a fresh cause of action to seek cancellation. The Delhi High Court affirmed that executing a sale deed to secure a loan liability cannot be grounds for cancellation when the underlying execution is admitted and legal formalities are complied with.
A bench of Justice Neena Bansal Krishna dismissed a regular first appeal challenging the rejection of a civil suit under Order VII Rule 11 of the Code of Civil Procedure, 1908. The Court was considering an appeal filed by an owner who sought cancellation of a registered sale deed on grounds that registration was initially refused for lack of a No Objection Certificate (NOC) and later completed without his presence.
Key Takeaways
Execution Admission Limits Cancellation Suits
Where the vendor does not deny the execution of the sale deed, subsequent procedural cures by the purchaser do not give rise to a fresh cause of action.
NOC Deficiency Cures Validate Registration
The initial refusal to register a conveyance deed due to a missing NOC stands cured once the certificate is produced and accepted by appellate authorities under the Registration Act, 1908.
Section 73 Omission Signifies Unwithdrawn Consent
Failure of the vendor to invoke Section 73 of the Registration Act, 1908 to deny execution before registering authorities confirms that consent was never validly withdrawn.
Court Observations and Directions
The High Court held that the appellant had failed to establish any cause of action, noting that the execution of the document was never in dispute. Addressing the procedural compliance during registration, the Court observed:
The Court, in its reasoning, observed: "...since the execution of the Sale Deed was never denied by the Plaintiff, and the refusal of registration by the Sub-Registrar was solely on the ground of want of NOC, which was subsequently obtained, there was no ground for declaring the registration as null and void."
Regarding the lack of challenge to execution by the vendor, the Court held:
The Court, in its reasoning, observed: "Had the Plaintiff withdrawn his consent or was not agreeable to the execution of the Sale Deed, he had the option to invoke S.73 to challenge the Sale Deed. However, the Plaintiff did not move any Application under S.73, indicating that he had not withdrawn his consent at any time."
The Court has following directions:
"Thereby the Appeal is accordingly, dismissed along with the pending Applications."
Ratio
A civil suit seeking declaration and cancellation of a registered sale deed is barred for lack of cause of action under Order VII Rule 11 of the Code of Civil Procedure, 1908 if the vendor admits execution and consideration, and the initial refusal of registration was purely procedural due to a missing document that was subsequently cured under statutory appellate remedy.
Background
The plaintiff/appellant filed a suit seeking declaration and cancellation of a sale deed dated February 19, 2016, registered on November 20, 2018, in respect of agricultural land in Village Alipur, Delhi. The plaintiff claimed that the document was executed merely to secure a loan liability extended by the directors of Defendant No. 1 company, and that no actual sale consideration was received nor physical possession transferred.
Registration was initially refused by the Sub-Registrar on March 23, 2016, due to non-submission of an original NOC. Subsequently, the defendants obtained the NOC and preferred an appeal under Section 72 of the Registration Act, 1908. The Deputy Commissioner/Registrar (North) set aside the refusal order on October 26, 2018, and remanded the matter to the Sub-Registrar, who registered the sale deed on November 20, 2018.
The trial court rejected the plaint under Order VII Rule 11 of the Code of Civil Procedure, 1908, holding that the plaintiff admitted execution and that the deficiency in NOC stood cured. Concurring with the trial court, the High Court held that the plaint disclosed no cause of action and dismissed the appeal.
Case Details:
Case No.: RFA 675/2026, CM APPL. 44818/2026
Case Title: Prahlad Singh v. M/s Sunrise Inframart Pvt. Ltd & Ors
Source: 2026 CaseBase(DEL) 3741
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