Karnataka High Court Upholds Builder/Developer in Registration Matter Concerning Flats on Perpetual Lease Land. Registration Cannot Be Refused Merely Because Kaveri-2.0 Portal Shows Original Lessor as Owner; Perpetual Leaseholder Has Transferable Interest Under Sections 105 and 108(j) of Transfer of Property Act, 1882.

Case Note & Summary

The writ petition arose before the High Court of Karnataka at Dharwad under Articles 226 and 227 of the Constitution of India. The petitioner, a builder and developer, sought a writ of mandamus to direct the respondent authorities to accept and register sale deeds for the remaining flats in Krish Jeevan Apartment, and alternatively to provide manual registration or modify the technical mapping in the Kaveri-2.0 portal to recognise his leasehold interest. The dispute concerned property held under a Nirantara Patta/perpetual lease in the Belagavi region. The petitioner acquired the property from an erstwhile holder under a Nirantara Patta or permanent lease, obtained necessary permissions from the competent local authority, constructed a residential apartment consisting of 34 flats, and received a completion certificate. Out of these 34 flats, 21 flats were sold and their sale deeds were registered before the introduction of the Kaveri-2.0 portal. The difficulty arose with the remaining 13 flats. After the introduction of Kaveri-2.0, the sale deeds presented by the petitioner were not processed because the petitioner's name did not appear as Owner in municipal and e-property records; the original lessor was reflected as Owner while the petitioner appeared only as Holder/Tax Payer. The petitioner contended that the underlying title documents disclosed a permanent and transferable leasehold interest and that the software could not defeat a substantive right otherwise recognised by law. The records showed that respondent No.3 had communicated to respondent No.2 the difficulties being faced in registering documents relating to Nirantar Patta or perpetual lease properties and requested that such properties be incorporated in Kaveri-2.0. A subsequent communication concerning a representation by CREDAI Belagavi acknowledged that in several areas of Belagavi city, properties were held under Nirantar Patta or perpetual lease arrangements and that, owing to existing API mapping, the name of the original owner was transmitted to Kaveri instead of the name of the person holding the perpetual leasehold interest. The authority itself requested that where e-Khata was issued on the basis of a Nirantar Patta or perpetual lease, the name of the leaseholder or occupant should be transmitted through the API. The core legal question was whether the respondents could refuse registration merely because the e-property and Kaveri-2.0 records designated the original lessor as Owner and the petitioner as Holder/Tax Payer. The court examined Section 105 of the Transfer of Property Act, 1882, which defines a lease as a transfer of a right to enjoy immovable property for a certain time or in perpetuity, and Section 108(j), which recognises the lessee's right to transfer the interest. The court held that a lease is not a mere permission to occupy but creates an interest in property, and that a perpetual lessee with a transferable interest can lawfully convey that interest even without absolute freehold ownership. On examining the petitioner's Nirantara Patta documents, the court found that they disclosed a permanent or perpetual leasehold interest, not a revocable licence, and that they constituted title documents relating to that interest. Relying on Smt. Marembi v. Jiyauddin Safisab Khatib and Dr. V.M. Kerudi v. Principal Secretary, Urban Development Department, the court observed that a registered Nirantara Patta cannot be treated as a mere rent receipt and that a perpetual lease continues valid so long as lease rentals are paid. The court held that the question for the registering authority is not whether the petitioner is the absolute owner of the underlying land but whether the petitioner possesses a legally recognisable and transferable interest which he is competent to convey. Based on the material placed before the court, the answer was clearly in the affirmative. The provided judgment text did not include the final operative directions, but the reasoning favoured the petitioner.

Headnote

Issue of Consideration

Final Decision

The court held that the question for the registering authority is not whether the petitioner is the absolute owner of the underlying land but whether the petitioner possesses a legally recognisable and transferable interest which he is competent to convey. Based on the material placed before the court, the answer was clearly in the affirmative. The provided judgment text did not include the final operative directions.

Law Points