An agreement holder may not necessarily be a necessary or proper party in a suit for specific performance.

M.M. Sundresh J.

1. The appellants are the plaintiffs in the suit. The suit had been filed for the specific performance in C.S.No.809 of 2010 against the defendants 1 to 3. Pending the suit, the fourth respondent herein filed an application in Application No.5678 of 2011 seeking to implead himself as a party defendant alleging that he is an agreement holder in the suit property. The learned single Judge allowed the application and hence, the present appeal before us.

2. The learned counsel appearing for the appellants would submit that in a suit for specific performance, the appellants being the plaintiffs are the dominus litis, and hence, it is for them to choose a party defendant. The fourth respondent is neither a necessary party nor a proper party for deciding the issues involved in the suit. The agreement entered into between the defendants 1 to 3 and the fourth defendant is a subsequent one. There cannot be any possession in pursuant to the part performance without registration of the alleged agreement as required under Section 17 of the Indian Registration Act. The fourth respondent cannot agitate his rights in a suit for specific performance filed by the appellants by enlarging its scope. Therefore, the appeal will have to be allowed.

3. Per contra, the learned counsel for the fourth respondent would submit that the records would show that the said respondent is in possession. He has parted with the entire sale consideration. There is also power deed registered in favour of the said respondent pursuant to which alone possession has been given. Substantial improvements had been made by the fourth respondent in pursuant to the document executed by the respondents 1 to 3 in his favour. As the fourth respondent has got substantial interest in the suit property, it is necessary that he needs to be added as a party defendant. Therefore, the appeal will have to be dismissed.

4. Admittedly, the agreement of the appellants is earlier to that of the fourth respondent. The question as to whether the agreement between the appellants on the one hand and the respondents 1 to 3 on the other hand was cancelled validly will have to be decided in the suit. Further, the issue to be decided in the suit is as to whether the appellants are entitled to the discretionary relief of specific performance at the hands of the respondents 1 to 3. Therefore, we are of the considered view that the fourth respondent is neither a necessary nor a proper party. The respondents 1 to 3 are contesting the suit. They have also filed their statements. Further, it is not the case of the fourth respondent that there is a collusion between the appellants and the respondents 1 to 3. It is not as if the fourth respondent has obtained a sale deed in his favour. In other words, admittedly, he is only an agreement holder. His right can only be a right to get the sale deed executed. The questions as to whether the fourth respondent is a bona fide agreement holder, the agreement is valid or not and consequently he is entitled to get a sale deed in his favour cannot be decided in a suit filed by the appellants. Therefore, we are of the considered view that the appeal will have to be allowed. Accordingly, the appeal is allowed and the order of the learned single Judge of this Court is set aside. However, we make it clear that the allowing of this appeal will not stand in the way of the fourth respondent in filing a comprehensive suit including the suit for specific performance, if he so desires. If the suit is filed by him, the suit will have to be decided on its own merits and in accordance with law without being influenced by any of the observation made by us in the appeal. No costs. Connected M.P.No.1 of 2012 is closed.