Chhajju Ram Loses Appeal as Allahabad High Court Holds Lis Pendens Applies to Court Auction Sales

The Allahabad High Court has dismissed a second appeal filed by Chhajju Ram, affirming a decree for specific performance of an agreement to sell agricultural land. In a significant ruling, Justice Arun Kumar held that the principle of lis pendens applies to court auction sales, even though such sales are involuntary alienations. The Court also clarified that an adverse order in execution proceedings under the unamended Order XXI Rule 58 of the Code of Civil Procedure does not operate as res judicata barring a separate suit for specific performance.

The Dispute Over Nawab Singh's Land

The case originated from an agreement to sell dated 22 April 1972, by which Nawab Singh, the recorded bhumidhar of Plot No. 329 in Village Kalakuri, agreed to sell the property to Babu Singh for ₹7,500. Babu Singh paid ₹3,500 as earnest money and claimed possession was delivered in part performance. When Nawab Singh failed to execute the sale deed, Babu Singh filed a suit for specific performance on 24 October 1973.

Meanwhile, Chhajju Ram had instituted a money suit against Nawab Singh on 5 July 1973, based on an alleged bond. He obtained an attachment before judgment over the same property on 16 July 1973. The money suit was decreed, and on 17 April 1974—during the pendency of Babu Singh's specific performance suit—Chhajju Ram purchased the property himself at a court auction for ₹12,250. Babu Singh's objection under Section 47 CPC was dismissed, and the sale was confirmed. Chhajju Ram took possession through the executing court on 16 January 1975.

Babu Singh amended his plaint to implead Chhajju Ram, alleging the bond and decree were collusive and fraudulent. Both the trial court and the first appellate court decreed specific performance, applying the doctrine of lis pendens and holding that the auction purchaser took the property subject to the result of the pending suit. Chhajju Ram appealed to the High Court.

Arguments on Appeal

Senior Counsel for the appellant argued that the agreement was not proved, that the plaintiff had failed to show readiness and willingness, and that the court below misapplied Section 52 of the Transfer of Property Act. He contended that the doctrine of lis pendens governs only voluntary transfers and does not invalidate judicial sales. He also urged that the dismissal of Babu Singh's objection in the execution proceedings operated as res judicata , relying on a Full Bench decision of the Andhra Pradesh High Court in Gurram Seetharam Reddy v. Gunti Yashoda .

Counsel for the respondent supported the concurrent findings, arguing that the agreement was genuine, the plaintiff was ready and willing, and the auction sale took place after the suit was instituted, thus attracting lis pendens . He relied on Supreme Court judgments in Kedarnath Lal v. Sheonarain and Samarendra Nath Sinha v. Krishna Kumar Nag to assert that the principle applies to court sales.

Lis Pendens Applies to Court Auctions

The Court rejected the appellant's contention that lis pendens is confined to voluntary transfers. Citing the Supreme Court's decision in Samarendra Nath Sinha , Justice Arun Kumar observed that although Section 52 of the Transfer of Property Act strictly does not apply to involuntary alienations, the principle of lis pendens does apply. The Court quoted:

"The auction sale cannot be treated as void merely because it took place pendente lite . The legal consequence is that the auction purchaser acquires the property subject to the result of the pending litigation."

The Court emphasized that notice is not the foundation of the doctrine. "The appellant's contention that he was a purchaser without notice also cannot defeat the operation of lis pendens . Notice is not the foundation of the doctrine. The doctrine operates by reason of the pendency of the litigation itself."

The Court also clarified that an earlier attachment of the property does not take the acquisition outside the principle of lis pendens , as attachment only prevents alienation and does not create title.

Res Judicata Plea Fails

On the second substantial question, the Court held that the order passed in the execution proceedings under the unamended Order XXI Rule 58 does not operate as res judicata barring the suit for specific performance. The Court distinguished between the limited statutory conclusiveness under Rule 63 and a general bar under Section 11 CPC.

Relying on the Supreme Court's decision in Mangru Mahto v. Thakur Taraknathji Tarakeshwar Math , the Court explained that the statutory conclusiveness under Rule 63 extended only to the question whether the property was liable to attachment and sale in execution of the particular decree. It did not constitute an adjudication of the independent contractual claim for specific performance.

The Court noted that the suit for specific performance was already pending when the execution objection was decided, so the plaintiff was not seeking a second adjudication of an execution claim.

Concurrent Findings Upheld

The Court declined to interfere with the concurrent findings of fact regarding the genuineness of the agreement, payment of earnest money, delivery of possession, and the plaintiff's readiness and willingness. It found that the circumstances relied upon by the appellant—such as the place of execution and non-examination of the stamp vendor—did not outweigh the evidence supporting the agreement.

The Court also rejected the argument that granting specific performance would be inequitable simply because the auction purchaser paid a higher price. The discretion under Section 20 of the Specific Relief Act was properly exercised.

Outcome

The High Court dismissed the second appeal with no order as to costs. It answered the substantial questions of law as follows: (i) The principle of lis pendens applies to court auction sales, and the purchaser takes the property subject to the result of the pending litigation; (ii) An order under the unamended Order XXI Rule 58 does not operate as res judicata on an independent claim for specific performance.

The judgment reaffirms the protective scope of the lis pendens doctrine, ensuring that court auction sales cannot be used to defeat pending litigation over immovable property.