Case Analysis by Akinchan Aggarwal, Advocate — B.A. (Hons.) Gold Medalist, LL.B. (University Rank 2), LL.M. (Dispute Resolution), UGC–NET, Ph.D. (Pursuing)
2025 INSC 1329 · Civil Appeal No. 13835 of 2025 · Decided 19 November 2025
Bench: Justice J.B. Pardiwala and Justice K.V. Viswanathan · Judgment by Viswanathan J.
A man agreed to buy land in Erode in March 1988. He sued, won an ex-parte decree for specific performance in September 1993, and then sold the decree — not the land, the decree — to someone else for twenty thousand rupees in July 1995.
Thirty years later, the Supreme Court has finally decided whether that assignment deed needed to be registered.
It did not. And in saying so the Court has done three things the headlines have not picked up: it has held a twenty-year-old Andhra Pradesh precedent to be wrong, it has adopted a Bombay High Court Single Judge's reasoning as its own, and it has quietly demolished the revenue argument that keeps this objection alive in executing courts across the country.
The question
Section 17(1)(e) of the Registration Act, 1908 makes registration compulsory for:
Everything turns on the words in bold. The clause is not triggered by the instrument of assignment dealing with immovable property. It is triggered only where the decree being assigned itself creates or extinguishes an interest in immovable property.
So the real question was never about the assignment deed at all. It was: does a decree for specific performance create an interest in the property?
How the case travelled
| Date | Event |
|---|---|
| 01.03.1988 | Agreement of sale |
| 03.09.1991 | Plaintiff deposits balance consideration of Rs. 15,000 in court |
| 13.09.1993 | Ex-parte decree for specific performance, O.S. No. 100/1989, First Additional Sub Court, Erode |
| 17.07.1995 | Decree assigned to Shanmugam for Rs. 20,000 (Ex. B1) |
| 2004 | Assignee files E.P. No. 150/2004 |
| 13.03.2008 | Executing Court orders execution of the sale deed |
| 31.10.2009 | Judgment-debtor's heirs apply under Section 47 CPC to set it aside |
| 08.04.2010 | Executing Court accepts the objection — assignment void for want of registration |
| — | Madras High Court reverses in revision, relying on Mumtaz Ahmad v. Sri Ram (1913) |
| 19.11.2025 | Supreme Court dismisses the appeal and upholds the High Court |
What the Court held
The reasoning runs in four steps, and each is worth having separately because each is citable on its own.
1. An agreement of sale creates no interest in property
Section 54 of the Transfer of Property Act says so expressly. The Court went back to Suraj Lamp & Industries v. State of Haryana (2012) 1 SCC 656, and through it to Narandas Karsondas and Rambhau Namdeo Gajre: a contract of sale does not of itself create any interest in or charge on the property. What it creates is a personal obligation — described in Section 40 of the Transfer of Property Act as an obligation arising out of contract and annexed to the ownership of property, but not amounting to an interest or easement in it.
Ownership of immovable property worth a hundred rupees or more passes on one event and one event only: the execution and registration of a deed of conveyance.
2. A decree does not upgrade that obligation into an interest
This is the step the appellants had to win and could not. Their senior counsel reached for Black's Law Dictionary on the meaning of “interest” — a legal share in something, a legal or equitable claim to or right in property — and argued that a decree for specific performance must create such an interest.
The Court's answer, drawing on Babu Lal v. Hazari Lal Kishori Lal (1982) 1 SCC 525 and the line of authority behind it, is that a decree for specific performance only declares the decree-holder's right to have a transfer executed in his favour. It does not transfer title. Until the sale deed is executed — by the judgment-debtor or by the court — title remains vested in the defendant, and the decree-holder has no right even to possession.
If the decree does not create an interest in the property, then the assignment of that decree cannot be an instrument assigning a decree that creates an interest in property. Section 17(1)(e) simply never engages.
3. The contract survives the decree — and so the decree is only preliminary
This is the most doctrinally interesting part of the judgment and the part with the longest reach.
Passing a decree for specific performance does not extinguish the contract. Section 28 of the Specific Relief Act, 1963 assumes this: it lets the vendor apply in the same suit to have the contract rescinded if the purchaser does not pay within the time allowed. The Court cited Hungerford Investment Trust v. Haridas Mundhra (1972) 3 SCC 684 for the proposition that the contract subsists notwithstanding the decree, carrying with it an implied term that the parties will complete within a reasonable time.
From that, the consequences the Court adopted:
- A decree for specific performance is in the nature of a preliminary decree.
- The suit is deemed to be pending even after the decree, and the court retains control over the whole matter.
- The court may direct execution of the sale deed by the vendor, or through the court, or refuse it if the decree-holder is not ready and willing to abide by his obligations.
- In an appropriate case the court may order rescission, to do equity.
- Therefore a decree-holder is not, merely by holding the decree, entitled as of right to the sale deed.
Those propositions are not new law, but the Court has now put a Supreme Court stamp on a formulation that had been sitting in a High Court judgment since 2011 — which brings us to the part nobody is reporting.
The two precedent moves
A Bombay Single Judge, promoted
In Amol v. Deorao, 2011 SCC OnLine Bom 11, a learned Single Judge of the Bombay High Court (R.K. Deshpande J.) had worked out the whole problem. The Supreme Court called it an erudite judgment which repays study, reproduced paragraphs 27, 28 and 30 in full, and then recorded, in terms, its concurrence with those paragraphs.
Practitioners should note the effect. Those three paragraphs are now Supreme Court law. If you are arguing this point, cite Rajeswari for the authority and Amol for the reasoning, because the reasoning is more fully worked out in Amol than in the paragraphs of Rajeswari that adopt it.
An Andhra Pradesh precedent, dismantled
The Executing Court in this case had not invented its objection. It had followed K. Bhaskaram v. Mohammad Moulana, AIR 2005 AP 524, which had held in terms that assignment of a decree relating to immovable property worth a hundred rupees or more is compulsorily registrable. For twenty years that decision had been doing exactly this work in executing courts.
At paragraph 33 the Supreme Court held that K. Bhaskaram, on the question of registration of an assignment of a decree for specific performance, does not lay down the correct law.
And the Court explained how the bad precedent came about, which is the most instructive sentence in the judgment. In K. Bhaskaram, it appears that the parties proceeded on an admission that registration was required. Nobody argued the point. The court also had an independent ground — breach of the proviso to Order 21 Rule 16 CPC — on which to decide the case.
The Court also disposed of the appellants' reliance on Satish Kumar v. Surinder Kumar (1969) 2 SCR 244. That case concerned Section 17(1)(b), which likewise requires the creation or extinguishment of a right, title or interest in immovable property. Since no interest is created here, Section 17(1)(b) is no more applicable than Section 17(1)(e).
The revenue argument, and why it failed
The most practical exchange in the case is the one the reports have skipped entirely.
The appellants argued a floodgates point with real force: if assignments of specific performance decrees need not be registered, then parties will obtain a decree and, instead of executing a sale deed, assign the decree over and over for twelve years, moving the benefit of the property from hand to hand while paying no registration charges at all. The Registration Act would be defeated by design, and the State would lose revenue.
The Court's answer, at paragraph 32, is short and complete:
That is the answer to give an executing court that raises the objection suo motu, and it is worth having at hand.
What actually protects a judgment-debtor
If a registration objection is not available, what is? The judgment points to the answer without labouring it, and it is the practical takeaway for anyone on the other side of an assigned decree.
Order 21 Rule 16 CPC. The transferee of a decree may apply for execution, and the decree may be executed as if the application were made by the original decree-holder. But the first proviso is mandatory: where the decree has been transferred by assignment, notice of the application shall be given to the transferor and the judgment-debtor, and the decree shall not be executed until the court has heard their objections.
The Court expressly recorded that no argument about non-compliance with that proviso had been advanced in this case. In K. Bhaskaram, by contrast, breach of Rule 16 was one of the grounds — and that part of K. Bhaskaram has not been disturbed.
Two further points sit alongside it. Rule 16 requires assignment in writing or by operation of law — so while the deed need not be registered, an oral assignment will not do. And Section 15(b) of the Specific Relief Act allows a representative-in-interest to obtain specific performance, which the Court confirmed — following Kapilaben v. Ashok Kumar Jayantilal Sheth (2020) 20 SCC 648 and the Constitution Bench in Khardah Co. v. Raymon & Co. — includes the assignee of a contractual interest. Rights under a contract are assignable; obligations are not, without the promisee's consent.
Where this leaves things
| Proposition | Position after Rajeswari |
|---|---|
| Assignment of a specific performance decree | Does not require registration under s.17(1)(e) or s.17(1)(b) |
| Must it be in writing? | Yes — Order 21 Rule 16 CPC requires assignment in writing |
| Does the decree give the holder title? | No. Title passes only on a registered sale deed |
| Is the decree-holder entitled to the sale deed as of right? | No. The decree is preliminary in nature; the court retains discretion |
| Judgment-debtor's remedy against an assignee | The proviso to Order 21 Rule 16, and s.28 Specific Relief Act — not a registration objection |
| K. Bhaskaram (AIR 2005 AP 524) | Not good law on registration of such an assignment |
| Amol v. Deorao (2011 SCC OnLine Bom 11) | Paragraphs 27, 28 and 30 expressly approved |
One closing observation. The Madras High Court had got this right by relying on Mumtaz Ahmad v. Sri Ram, an Allahabad decision from 1913. The correct answer had been available in the reports for a hundred and twelve years. What kept the question alive was not doctrinal difficulty but a single High Court judgment delivered on a concession, and an execution system slow enough that a wrong turn takes a generation to correct.
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This analysis is written for study and general information and is based on the full text of the judgment in Rajeswari & Ors. v. Shanmugam & Anr., 2025 INSC 1329, decided on 19 November 2025. It is not legal advice, and no lawyer–client relationship arises from reading it. For any actual dispute, consult an advocate on the specific facts.
