25 August 2004
Supreme Court
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RAMBHAU NAMDEO GAJRE Vs NARAYAN BAPUJI DHOTRE (DEAD)THRU.LRS.

Bench: ASHOK BHAN,S.H. KAPADIA
Case number: C.A. No.-004610-004610 / 2000
Diary number: 18799 / 1999
Advocates: SHIVAJI M. JADHAV Vs


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CASE NO.: Appeal (civil)  4610 of 2000

PETITIONER: Rambhau Namdeo Gajre                                     

RESPONDENT: Narayan Bapuji Dhotra (dead) through Lrs.                

DATE OF JUDGMENT: 25/08/2004

BENCH: Ashok Bhan & S.H. Kapadia  

JUDGMENT: J U D G M E N T                                                                   BHAN, J.

       Defendant/appellant (hereinafter referred to as "the appellant")  has filed this appeal against the judgment of the High Court in  Second Appeal No. 205 of 1984 whereby the High Court reversing  the judgment and decree passed by the first Appellate Court has  restored the order passed by the Civil Court, Jalna in Suit No. 184 of  1974.  The Trial Court had decreed the suit filed by the Narayan  Bapuji Dhotra,  (deceased)  now represented through his Legal  representatives (hereinafter referred to as "the respondent").

       The property in dispute is agricultural land bearing Survey No.  94 admeasuring 18 acres and 23 gunthas situated at Village  Jambwadi, Taluka Jalna in the State of Maharashtra.  Respondent  who was the owner of the suit land filed the Suit for possession of the  land with the averment that the appellant had wrongfully  dispossessed him of the suit land in April, 1965.  According to him, he  was the owner of the suit land which was his self-acquired property.   It was averred that in the Special Civil Suit No. 20 of 1962 filed by his  brother for partition and possession of the ancestral  property, the suit  land  along with other lands was left to his share.

       Appellant resisted the suit contending, inter alia, that under an  agreement of sale dated 16.6.1961 Narayan Bapuji Dhotra, original  plaintiff, and his brother Manohar agreed to sell the suit land to  Pishorrilal Punjabi  who paid the entire amount of consideration and  was put in possession of the land in part performance of the  agreement of sale.  That Pishorrilal executed an agreement of sale of  the suit land in favour of the appellant on 1.9.1961.  That he paid the  entire amount of the consideration to Pishorrilal and was put in  possession of the suit land  by Pishorrilal in part performance of the  agreement dated 1.9.1961.  It was contended that since he was in  possession of the suit land in part performance of the agreement, he  was entitled to protect his possession in terms of Section 53-A of the  Transfer of Property Act (hereinafter referred to as "the Act").

       Trial Court upon consideration of the evidence on record came  to the conclusion that a mere contract of sale is incapable of creating  any right or title in favour of the transferee.  That no right or interest  was created in the suit land in favour of Pishorrilal by virtue of the  agreement of sale dated 16.6.1961. That the original agreement of  sale between Narayan Bapuji Dhotra  and Pishorrilal was not placed  on the record and the certified copy produced as Exhibit 16/1D had  not been proved.  That the appellant had failed to exercise due care  in ascertaining the title of Pishorrilal  before entering into an

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agreement of sale with him.  It was highly improbable that the  appellant had no knowledge about the pendency of the suit between  the plaintiff and his brother and Pishorrilal.  It was also held that the  appellant could not defend his possession under Section 53-A of the  Act as against the plaintiff/respondent.  In view of the findings  recorded the trial Court proceeded to pass the decree for possession  in favour of the respondent.

       Aggrieved against the judgment and decree passed by the Trial  Court, the appellant filed an appeal. The first appellate Court taking a  different view set aside the judgement of the trial Court and dismissed  the suit filed by the plaintiff/respondent.  The first Appellate Court  came to the conclusion that the appellant had acquired an equitable/  possessory title to the suit land on the basis of the  agreement of sale  executed in his favour by Pishorrilal and was. therefore, entitled to  protect his possession under Section 53-A of the Act.   

       Original plaintiff/respondent died.  His Legal representatives  (now the respondent) filed a second appeal in the High Court.   Although, a  number of questions of law were framed at the time of  admission of the second appeal but at the time of final disposal the  only substantial question of law worth consideration was found to be: "Whether the defendant, who is in possession  of the suit land on the basis of an agreement  of sale dated 1.9.1961 executed by Pishorrilal  Punjabi, who himself, in turn, had come in  possession of the suit land on the basis of a  similar agreement dated 16.6.1961 executed  by the plaintiff, can claim benefit of the  equitable doctrine of part performance as  stated in Section 53-A of the Transfer of  Property Act to protect his possession."

The above noted question was answered by the High Court in the  negative.  It was held that the appellant was not entitled to protect his  possession claiming benefit of equitable doctrine of part performance  enshrined in Section 53-A of the Act.  Title in the suit property had not  been conveyed in favour of Pishorrilal by executing a registered sale  deed.   In the absence of title in the property Pishorrilal could neither  enter into an agreement of sale nor transfer possession of the  property to the appellant in part performance of the agreement under  Section 53-A of the Act.  That the appellant failed to take due care  and pre-caution to ascertain the title of Pishorrilal to the suit land  before entering into transaction with him.   

       Section 53-A was enacted in 1929 by the Transfer of Property  (Amendment) Act, 1929, and imports into India in a modified form the  equity  of part performance as it developed in England over the years.   Doctrine of part performance as stated in Section 53-A of the Act is  an equitable doctrine which creates a bar of estoppel in favour of the  transferee against the transferor.

       It is seen that many  a times a transferee takes possession of  the property in part performance of the contract and he is willing to  perform his part of the contract.  However, the transferor some how  or the other  does not complete the transaction by executing a  registered deed in favour of the transferee, which is required under  the law.    At times, he tries to get back the possession of the  property.  In equity the Courts in England held that it would be unfair  to allow the transferor to take advantage of his own fault and evict the  transferee from the property.  The doctrine of part performance aims  at protecting the possession of such transferee provided certain

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conditions contemplated by Section 53-A are fulfilled.    The essential  conditions which are required to be fulfilled if a transferee wants to  defend or protect his possession under Section 53-A of the Act have  been culled out of this Court in Shrimant Shamrao Suryavanshi &  Anr. Vs. Pralhad Bhairoba Suryavanshi, 2002 (3) SCC 676, are:

"(1) There must be a contract to transfer for            consideration of any immovable property;  

(2)     the contract must be in writing, signed by  the transferor, or by someone on his  behalf; (3)     the writing must be in such words from  which the terms necessary to construe the  transfer can be ascertained;

(4)     the transferee must in part performance of  the contract take possession of the  property, or of any part thereof;

(5)     the transferee must have done some act  in furtherance of the contract; and  

(6)     the transferee must have performed or be  willing to perform his part of the contract."

If these conditions are fulfilled then in a given case there is an  equity in favour of the proposed transferee who can protect his  possession against the proposed transferor even though a registered  deed conveying the title is not executed by the proposed transferor.    In such a situation equitable doctrine of part performance provided  under Section 53-A comes into play and provides that "the transferor  or any person claiming under him shall be debarred from enforcing  against the transferee  and persons claming under him any right in  respect of the property of which the transferee has taken or continued  in possession, other than a right expressly provided by the terms of  the contract."   

Protection provided under Section 53-A of the Act  to the  proposed transferee is a shield only against the transferor.  It  disentitles the transferor from disturbing the possession of the  proposed transferee who is put in possession in pursuance to such  an agreement.  It has nothing to do with the ownership of the  proposed transferor who remains full owner of the property till it is  legally conveyed by executing a registered sale deed in favour of the  transferee.  Such a right to protect possession against the proposed  vendor cannot be pressed in service against  a third party.

The question which falls for our consideration is: "Whether the  doctrine of part performance could be availed of by the defendant  with whom the  respondent  had never entered into an agreement of  sale?"  It is an admitted case of the parties that the  plaintiff/respondent  had entered into an agreement of sale with  Pishorrilal on 16.6.1961 and who had taken possession of the suit  land in part performance thereof.  Sale deed had not been executed  and registered in his favour.  Pishorrilal did not take any steps for  getting the agreement of sale specifically enforced and obtain a  registered sale deed in respect of the suit land.  Within a period of 2- 1/2 months Pishorrilal executed a similar agreement of sale dated  1.9.1961 in favour of the appellant and put him in possession of the  suit land. Pishorrilal did not have any right to enter into an agreement  of sale with the appellant as he was not the owner of the suit land.    The appellant did not care to ascertain the title of Pishorrilal to the

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suit land before entering into the transaction with him.

There was no agreement between the respondent and the  appellant in connection with the suit land.  The doctrine of part  performance enshrined in Section 53-A of the Act could have been  availed of by Pishorrilal against the plaintiff/respondent subject to the  fulfillment of certain conditions but the same could not be availed of  by the appellant against the plaintiff/respondent with whom he has no  privity of contract.  The doctrine of part performance as contemplated  by Section 53-A can be availed of by the transferee or any person  claiming under him.  The appellant not being the transferee within the  meaning of Section 53-A of the Act could not invoke the equitable  doctrine of part performance to protect his possession as against the  plaintiff/respondent.   The agreement to sell does not create  an interest of the  proposed vendee in the suit property.  As per Section 54 of the Act,  the title in immovable property valued at more than Rs. 100/- can be  conveyed only by executing a registered sale deed.  Section 54  specifically provides that a contract for sale of immovable property is  a contract evidencing the fact that the sale of such property shall take  place on the terms settled between the parties, but does not, of itself,  create any interest in or charge on such property.  It is not disputed  before us that the suit land sought to be conveyed is of the value of  more than Rs. 100.  Therefore, unless there was a registered  document of sale in favour of the Pishorrilal (proposed transferee) the  title of the suit land continued to vest in Narayan Bapuji Dhotra  (original plaintiff) and remain in his ownership.  This point was  examined in detail by this Court in State of U.P. Vs. District Judge &  Ors.,  1997 (1) SCC 496, and it was held thus:

"Having given our anxious consideration to the  rival contentions we find that the High Court  with respect had patently erred in taking the  view that because of Section 53-A of the  Transfer of Property Act the proposed  transferees of the land had acquired an  interest in the lands which would result in  exclusion of these lands from the computation  of the holding of the tenure-holder transferor  on the appointed day.  It is obvious that an  agreement to sell creates no interest in land.   As per Section 54 of the Transfer of Property  Act, the property in the land gets conveyed  only by registered sale deed.  It is not in  dispute that the lands sought to be covered  were having value of more than Rs. 100.   Therefore, unless there was a registered  document of sale in favour of the proposed  transferee agreement-holders, the title of the  land would not get divested from the vendor  and would remain in his ownership.  There is  no dispute on this aspect.  However, strong  reliance was placed by learned counsel for  Respondent 3 on Section 53-A of the Transfer  of Property Act.  We fail to appreciate how  that section can at all be relevant against the  third party like the appellant-State.  That  section provides for a shield of protection to  the proposed transferee to remain in  possession against the original owner who  has agreed to sell these lands to the  transferee if the proposed transferee satisfies  other conditions of Section 53-A.  That  protection is available as a shield only against

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the transferor, the proposed vendor, and  would disentitle him from disturbing the  possession of the proposed transferees who  are put in possession pursuant to such an  agreement.  But that has nothing to do with  the ownership of the proposed transferor who  remains full owner of the said lands till they  are legally conveyed by sale deed to the  proposed transferees.  Such a right to protect  possession against the proposed vendor  cannot be pressed in service against a third  party like the appellant-State when it seeks to  enforce the provisions of the Act against the  tenure-holder, proposed transferor of these  lands."                                                         [Emphasis supplied]

There was no agreement between the appellant and the respondent  in connection with the suit land.  The doctrine of part performance  could have been availed of by Pishorrilal against his proposed vendor  subject, of course, to the fulfillment of the conditions mentioned  above.  It could not be availed of by the appellant against the  respondent  with whom he has no privity of contract. Appellant has  been put in possession of the suit land on the basis of an agreement  of sale not by the respondent but by Pishorrilal, therefore, the privity  of contract is between Pishorrilal and the appellant and not between  the appellant and the respondent.  The doctrine of part performance  as contemplated in Section 53-A can be availed of by the proposed  transferee against his transferor or any person claiming under him  and not against a third person with whom he does not have a privity  of contract.

Doctrine of part performance is rooted in equity and provides a  shield of protection to the proposed transferee to remain in  possession against the original owner who has agreed to sell to the  transferee if the proposed transferee satisfies other conditions of  Section 53-A.  It operates as an equitable estoppel against the  original owner to seek possession of the property which was given to  the proposed vendee in part performance of the contract. Appellant  being a third party and not a privy to the transaction on which the  estoppel rests can take no advantage of it.

Pishorrilal did not have a transferable interest which he could  convey to the appellant by entering into an agreement of sale with the  appellant.  The appellant under the circumstances does not have the  equitable right to protect his possession as against the owner of the  land, i.e., the respondent. Appellant is not the transferee within the  meaning  of Section 53-A. The appellant did not get the possessory  or equitable title to the suit land through Pishorrilal as Pishorrilal  himself did not have any right in the property.  The only right  possessed by the Pishorrilal under Section 53-A was to protect his  possession as against his proposed vendee.  He did not have  conveyable interest in the property which he could transfer to a third  party including the possession of the property. For the reasons stated above, we do not find any merit in this  appeal and dismiss the same with costs.