2019 Supreme(Kar) 1336
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
Krishna S. Dixit, J.
Sri Honnappa, S/o. Late Gangappa - Petitioner
Vs.
Sri V. Shashidhara Chary, S/o. Sri V. Venkataramana Chary - Respondent
Writ Petition No. 51212/2019 (GMCPC)
Decided On : 02-12-2019
For the Petitioner: Sri H.M. Somashekaraiah, Adv.
For the Respondent: Sri M.V. Vedachala, Adv.
Headnote:
Transfer of Property Act, 1882 - Section 54 - Contract of sale - Invoking writ jurisdiction - Sale is defined as being a transfer of ownership for a price - In a sale there is an absolute transfer of all rights in properties sold - No rights are left in the transferor price is fixed by contract antecedent to conveyance - Price is essence of a contract of sale - There is only one mode of transfer by sale in regard to immovable property value more and that is by a registered instrument - It is now well settled that payment of entire price is not a condition precedent for completion of sale by passing of title as of Transfer of Property Act (`Act for short) defines sale as a transfer of ownership in exchange for a price paid or promised or part paid and part promised - If intention of parties was that title should pass on execution and registration title would pass to the purchaser even if the sale price or part thereof not paid – Held, Event of nonpayment of price (or balance price as the case may be) thereafter remedy of vendor is only to sue for balance price - He cannot avoid the sale - He is however entitled to a charge upon the property for unpaid part of sale price where ownership property has passed to buyer before payment of entire price Act - Normally ownership and title to the property will pass to purchaser on registration of sale deed with effect from execution of sale deed – Order accordingly
ORDER :
Petitioner being intending defendant in a specific performance suit in O.S. No.124/2016 filed by the respondent against the second respondent for enforcement of an agreement to sell dated 27.02.2013 is invoking writ jurisdiction of this Court for assailing the order dated 31.08.2019 a copy whereof is at Annexure– R, whereby his impleading application having been rejected, the learned trial Judge has not permitted him to enter the suit array.
2. The first respondent/plaintiff having entered through his counsel, resists the Writ Petition.
3. The short question that arises for consideration in this case is:
Whether an unpaid seller is a proper or necessary party to a suit for specific performance filed by the holder of the Agreement to Sell against the vendee of such seller ?
3. The rights of unpaid sellers are governed by the provisions of Section 54 & 55 of the Transfer of Property Act, 1882; the Apex Court in the case of Kaliaperumal Vs. Rajagopal, JT 2009 (7) SC 124 has observed as under:
“Sale is defined as being a transfer of ownership for a price. In a sale there is an absolute transfer of all rights in the properties sold. No rights are left in the transferor. The price is fixed by the contract antecedent to the conveyance. Price is the essence of a contract of sale. There is only one mode of transfer by sale in regard to immovable property of the value of Rs.100/or more and that is by a registered instrument. It is now well settled that payment of entire price is not a condition precedent for completion of the sale by passing of title, as Section 54 of Transfer of Property Act, 1882 (`Act' for short) defines `sale' as a transfer of ownership in exchange for a price paid or promised or part paid and part promised. If the intention of parties was that title should pass on execution and registration, title would pass to the purchaser even if the sale price or part thereof is not paid. In the event of nonpayment of price (or balance price as the case may be) thereafter, the remedy of the vendor is only to sue for the balance price. He cannot avoid the sale. He is, however, entitled to a charge upon the property for the unpaid part of the sale price where the ownership of the property has passed to the buyer before payment of the entire price, under Section 55(4)(b) of the Act. Normally, ownership and title to the property will pass to the purchaser on registration of the sale deed with effect from the date of execution of the sale deed..”
4. The above being the legal position, the remedy of the petitioner lies in suing for the unpaid consideration and not seeking entry to the array of parties in a suit for specific performance pending between two different persons who are parties to the alleged Agreement to Sell; petitioner is neither a proper party nor a necessary party to such a suit, even going by the parameters laid down by the Apex Court in Razia Begum Case, AIR 1958 SC 886.
In the above circumstances, the Writ Petition being devoid of merits, is rejected.
However, this order shall not come in the way of the petitioner to work out his remedies elsewhere.