Hemalatha (D) v. Tukaram (D) 2026 INSC 82 - Registered Sale Deed - Declaration As Sham Document - Presumption About Validity & Genuineness

Specific Relief Act 1963 - Section 34 - Declaration Suit - Registered Sale Deed -Strong presumption about the validity and genuineness- A Court must not lightly or casually declare a registered instrument as a “sham” - The burden of proof to displace this presumption rests heavily upon the challenger. Such a challenge can only be sustained if the party provides material particulars and cogent evidence to demonstrate that the Deed was never intended to operate as a bona fide transfer of title - The grounds typically accepted to challenge a registered Deed at the instance of the vendee/executant are fraud or want of capacity in any party or mistake of fact or fundamental illegality like where the Deed was executed under deceit or sold by a fraudster who did not own the land or where the Deed was executed without consideration, namely, if no money or value was actually exchanged despite recitals in the Deeds or where there was coercion or intimidation like where the seller was forced to sign without free consent. (Para 31-32) Pleading Standards - Code of Civil Procedure - Order VI Rule 4 - The person alleging that a registered Deed is a sham must satisfy a rigorous standard of pleading by making clear, cogent, convincing averments and provide material particulars in his pleadings and evidence. This Court is of the view that the test akin to a test under Order VI Rule 4 CPC is applicable to such a pleading and clever drafting creating illusion of cause of action would not be permitted and a clear right to sue would have to be shown in the plaint. (Para 34)

Registration - Registered documents must inspire certainty; they cannot be rendered precarious by frivolous litigation- caution against the growing tendency to challenge registered instruments ‘at the drop of a hat'. (Para 33)

Indian Evidence Act, 1872 - Section 91,92 -Mere suspicion or nebulous averments without material particulars would not be sufficient to dislodge the presumption under Sections 91 and 92. (Para 35)

Transfer of Property Act, 1882 - Section 58- The condition precedent for arriving at a finding that the transaction involves mortgage by way of conditional sale is that there must be an ostensible sale and the condition that on default of payment of mortgage money on a certain date, the sale shall become absolute or on condition that on such payment being made the sale shall become void, or on condition that on such payment being made the buyer shall transfer the property to the seller shall be embodied in the same document-A deeming fiction was added in the negative that a transaction shall not be deemed to be a mortgage unless the condition for reconveyance is contained in the document which purports to effect the sale. (Para 48-49)

Indian Contract Act, 1872 - Section 25 - Mere allegation of inadequacy of consideration does not make the Deed void. It is only in the absence of sale consideration being tendered that the sale deed would be void. (Para 60)

Revenue Entries -Revenue entries in the municipal records do not prove ownership. (Para 63)

Registration - Reforms - Urgent need for the digitization of registered documents and land records using secure, tamper-proof technologies such as Blockchain. Many experts believe that Blockchain, a shared, digital record book (ledger) system would ensure that once a transaction of a sale or mortgage or like nature is recorded, it becomes immutable and cryptographically secured- Such reforms are essential to minimize the scourge of forgery and "clever drafting" that clogs our judicial system. Registered documents must inspire absolute confidence to ensure the ease of doing business and to uphold the sanctity of property titles in a modern economy. (Para 76-77)