Whether unregistered document will be admissible in evidence for collateral purpose?

 Yes, unregistered documents are admissible in evidence for collateral purposes under the proviso to Section 49 of the Registration Act. While the general rule prohibits the admission of unregistered documents that are required to be registered, the law recognizes a specific exception for collateral purposes.

Legal Framework for Collateral Purpose

The proviso to Section 49 of the Registration Act provides that an unregistered document affecting immovable property and required to be registered may be received as evidence of any collateral transaction not required to be effected by registered instrument.

Principles Laid Down in K.B. Saha & Sons Case

The Hon'ble Supreme Court in K.B. Saha & Sons Pvt. Ltd v. Development Consultant Ltd (2008) 8 SCC 654 established the following comprehensive principles:

1. Primary Rule: A document required to be registered, if unregistered, is not admissible into evidence under Section 49 of the Registration Act

2. Collateral Purpose Exception: Such unregistered document can be used as evidence of collateral purpose as provided in the proviso to Section 49 of the Registration Act

3. Independence Requirement: A collateral transaction must be independent of, or divisible from, the transaction to effect which the law required registration

4. Registration Exemption: A collateral transaction must be a transaction not itself required to be effected by a registered document - meaning it should not be a transaction creating, declaring, assigning, limiting or extinguishing any right, title or interest in immovable property of the value of one hundred rupees and upwards

5. Limited Scope: If a document is inadmissible in evidence for want of registration, none of its terms can be admitted in evidence, and using a document to prove an important clause would not constitute using it for collateral purpose

6. Specific Performance Exception: A document required to be registered, if unregistered, can be admitted in evidence as evidence of a contract in a suit for specific performance

Understanding Collateral Purpose

The expression 'collateral purpose' is acknowledged as vague, and courts must decide in each case whether the purpose for which the unregistered document is sought to be used is truly collateral or whether it attempts to establish indirectly the title, interest or right to immovable property. A purpose is considered collateral if it is other than the one which the document itself serves.

Specific Particulars of Collateral Purpose

Permissible Collateral Purposes:

• Proof of Possession: An unregistered sale deed can be used to show possession of the plaintiff, limited to demonstrating the nature and character of possession which are collateral to the sale transaction

• Factum of Transaction: Documents may be required to prove the factum of a transaction, though not its content.

Impermissible Uses:

• Establishing Title: Cannot be used to establish title, interest or right to immovable property that the document was meant to convey

• Primary Transaction Purpose: Cannot be used for the primary purpose for which the document was created (e.g., using a sale deed to prove the sale itself)

• Partition Proof: Unregistered documents cannot be used to prove the primary purpose of partition between parties

The key distinction is that collateral purpose must relate to matters that are incidental to or separate from the main transaction that required registration, rather than serving as an indirect method to prove the registered transaction itself.

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