In a landmark judgment delivered on 22 January 2026, the Supreme Court of India emphatically reaffirmed that a registered sale deed carries a strong and formidable presumption of validity and genuineness, and cannot be lightly or casually declared a ‘sham’ without credible, cogent evidence demonstrating otherwise.
Case Citation and Bench
- Case Name: Hemalatha (Dead) by Legal Representatives (Lrs.) v. Tukaram (Dead) by Lrs. & Others
- Civil Appeal No.: 6640 of 2010
- Neutral Citation: 2026 INSC 82
- Bench: Justice Rajesh Bindal and Justice Manmohan
- Date of Judgment: 22 January 2026
This decision holds substantial significance for civil litigation involving property disputes and challenges to registered instruments under the Evidence Act, 1872, and the Transfer of Property Act, 1882.
Factual Background
The controversy traces back to 1971 in Bidar, Karnataka, involving a long-standing dispute over a residential property.
- Original Transaction (1971): On 12 November 1971, Tukaram, the respondent (now deceased), executed a registered sale deed in favour of Hemalatha for a consideration of ₹10,000. On the same day, a registered rental agreement was also executed, under which Tukaram continued to occupy the property as a tenant.
- Mortgage History: Prior to this, Tukaram had mortgaged the property in 1966 to one Sadanand Garje for ₹8,000. The 1971 sale was allegedly a mechanism to redeem that mortgage.
- Post-Sale Events: Though the sale deed was registered, Tukaram continued to occupy the premises and pay rent. After defaulting on rent, the appellants (Hemalatha’s legal heirs) initiated eviction proceedings in 1975. Tukaram responded by filing a civil suit in 1977 seeking a declaration that both the sale deed and rental agreement were “nominal, sham and not intended to be acted upon” — effectively asserting that the transaction was not a genuine sale but a mortgage in disguise.
Procedural History
The case moved through various judicial forums over decades:
- Trial Court: The suit was decreed in favour of Tukaram, finding the deed to be a nominal, sham transaction.
- First Appellate Court: On appeal, the Additional District Judge, Bidar, reversed the trial court’s decree in 1999 and held the sale deed to be genuine and valid.
- Karnataka High Court: In a second appeal (R.S.A No. 163/2000), the High Court restored the trial court’s judgment in 2010, relying on older precedents that allowed oral evidence to show a deed was never intended to be operative.
- Supreme Court: Aggrieved by the High Court’s order, the appellants approached the Supreme Court, which delivered the present judgment in 2026.
Legal Issues Before the Supreme Court
The Apex Court considered three core issues:
- Whether a registered sale deed can be declared a “sham” without strict, material evidence.
- Whether extrinsic oral evidence is admissible under Section 92 of the Indian Evidence Act, 1872, to contradict clear and unambiguous recitals in a registered instrument.
- Whether the 1971 transaction constituted a mortgage by conditional sale under Section 58(c) of the Transfer of Property Act, 1882, or an outright sale.
Supreme Court’s Analysis and Observations
- Strong Presumption of Validity
The Court emphasised that a registered sale deed attracts a strong presumption of validity and genuineness under Sections 91 and 92 of the Evidence Act. Registration is not a mere procedural formality; it imparts a high degree of sanctity to the document. Consequently, a court should not lightly or casually brand a registered instrument as a sham.
- Burden and Standard of Proof
The Supreme Court held that the burden to displace this presumption is formidable and lies squarely on the challenger. A party alleging that a registered deed is a sham must plead with clear, cogent, and convincing averments, supported by material particulars and evidentiary proof — not mere allegations or cleverly drafted phrases suggesting fraud.
The Court went further to highlight that nebulous or vague allegations would not suffice, and clever drafting to create the illusion of a cause of action would not be permitted.
- Oral Evidence and Section 92
In distinguishing this case from earlier precedents like Gangabai v. Chhabubai, the Supreme Court underscored that extrinsic oral evidence cannot be used to contradict clear and unambiguous recitals in a registered deed unless fraud, fundamental illegality, or other recognized exceptions are established with strong proof — not mere allegations.
- Nature of the Transaction
The Court also examined the terms of the deed, noting that it reflected an outright sale, without any condition for repurchase, which would have been a mandatory component of a mortgage by conditional sale under Section 58(c) of the Transfer of Property Act.
- Conduct of Parties
Notably, the respondent had admitted in a 1974 legal notice reply that he was a tenant under the rental agreement — undermining later claims that the transaction was never intended to transfer ownership.
Final Judgment
Based on the above considerations, the Supreme Court:
- Allowed the appeal in favour of the appellants (Hemalatha’s legal heirs).
- Set aside the Karnataka High Court’s 2010 order that had declared the 1971 sale deed and rental agreement as sham.
- Restored the decision of the First Appellate Court that upheld the genuineness of the sale deed.
- Dismissed the declaratory suit filed by Tukaram’s legal heirs with costs.
Significance
This judgment reinforces that registered sale deeds enjoy a high level of judicial protection and cannot be lightly faulted without strict proof. It also cautions courts to guard against a growing tendency to challenge registered instruments on flimsy or speculative grounds, as doing so would erode public confidence in property transactions and the certainty of land titles.
Justice Bindal and Justice Manmohan further suggested that digitisation of land records using secure, tamper-proof technologies like blockchain could help reduce disputes based on forged or denied execution of documents — a notable systemic observation accompanying the judgment.