DEED OF CANCELLATION

(Advocate S Selvakumar|Property advocates in Bangalore|Property lawyers in Bangalore)

Section31 of the Specific Relief Act, 1963, provides that any written instrument which is void or voidable and any party thereto has reasonable apprehension that such instrument, if left outstanding may cause him serious injury, may be cancelled by a Court on the action (suit) taken up by the party, if the Court in its discretion thinks proper to doso.

A contract may be void if it is against Law or public policy or may be voidable if it is vitiated by fraud, coercion and such other grounds. What can be done by a Court can, it appears, be done by the parties to an instrument or their legal representatives by mutual consent. Even otherwise the parties to a document may agree to cancel it by mutual consent for some reason and restore status quo. For example: an agreement for sale or lease or mortgage or for partition may be cancelled with the consent of the parties thereto. The matter may not, however, be so simple in case of deeds of transfer duly executed and registered. For example, a deed of conveyance duly executed by the parties cannot be nullified by executing a deed of conveyance because by the execution and registration of such a deed of conveyance the property stands vested in the Purchaser and the title cannot be divested by a mere execution of a deed of cancellation. In such a case, a deed of conveyance or re-conveyance from the Purchaser to the Vendor may become necessary. If the deed is vitiated by fraud or other ground, there is no possibility of parties agreeing by mutual consent to cancel the deed.It is only the Court which can cancel the deed duly executed under circumstances mentioned in Section 31 and other provisions of the Specific Relief Act.

Any unregistered document can be cancelled by mutual consent, without executing a separate document, by scoring off the document or by endorsing it with the remark made by mutual consent that the document is cancelled and the endorsement or scoring off should be signed by the parties. No document can be cancelled unless all parties,agree to the same.Occasions for cancellation of a duly executed and registered document by mutual consent are very rare or uncommon.

Cancellation deed is a chargeable item under Article 17 of the Indian Stamp Act. But it attracts stamp duty only if the deed of cancellation is attested by witnesses. A deed of cancellation is not necessarily required to be attested except when it relates to a will. Therefore, if deed is not attested it may not fall under this article but may fall under Article 5 (h) as agreement. If the document is cancelled merely by scoring or tearing no question of stamp duty will arise.

If the deed of cancellation relates to a deed which requires registration then the deed of cancellation also will have to be registered but not otherwise.

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Advocate Selvakumar

Property advocates in Bangalore