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1990 Supreme(P&H) 833
PUNJAB & HARYANA HIGH COURT
G.R.Majithia, J.
Raj Kumar
Versus
Shanti Saroop Gandhi
Regular Second Appeal No. 2030 of 1978,
Decided On : NOVEMBER 21, 1990
The seller is not bound to deliver vacant possession of the land agreed to be sold if there is an agreement to the contrary and the vendees have notice of the tenancy.
Headnote:
TRANSFER OF PROPERTY ACT, 1882 - SECTION 55(1)(F) - SALE OF PROPERTY - POSSESSION - SELLER'S OBLIGATION TO DELIVER POSSESSION - EXCEPTION IN CASE OF TENANCY - AGREEMENT TO THE CONTRARY - INTERPRETATION.
Fact of the Case:
Plaintiff sued to recover earnest money paid under an agreement to sell land, alleging that the vendor failed to deliver vacant possession. The vendor claimed that he was not bound to deliver vacant possession as the land was in possession of tenants and that the vendees had notice of the tenancy.
Finding of the Court:
The court held that the vendor was not bound to deliver vacant possession in the absence of a contract to the contrary, and that the vendees had notice of the tenancy. The court also held that the agreement to sell was admissible in evidence, and that the vendor's successor-in-interest was not personally liable to pay the disputed amount.
Issues: 1. Whether the vendor was bound to deliver vacant possession of the land agreed to be sold. 2. Whether the vendees had notice of the tenancy on the land agreed to be sold. 3. Whether the agreement to sell was admissible in evidence. 4. Whether the vendor's successor-in-interest was personally liable to pay the disputed amount.
Ratio Decidendi: 1. Section 55(1)(f) of the Transfer of Property Act, 1882 imposes an obligation on the seller to give the buyer possession of the property as its nature admits. 2. The words "as its nature permits" refer to physical or actual possession in the case of tangible property and formal or symbolical possession in the case of intangible property. 3. Possession does not necessarily import actual possession or personal occupation. 4. When the buyer has notice of a tenancy, he is only entitled to formal or symbolical possession. 5. The operation of Section 55(1)(f) can be excluded by a contract between the parties.
Final Decision: The appeal was dismissed.
1. The unsuccessful plaintiff has come up in second appeal against the judgment and decree of the first appellate court affirming on appeal those of the trial court whereby his suit for recovery of Rs. 11450.00 was dismissed.
2. The facts :-
Predecessor-in-interest of respondent No.1 executed an agreement to sell dated 21/02/1988 in favour of the plaintiff and defendant No.2. He agreed to sell land measuring 124 acres situated in village Talwandi Rana @ Rs. 820.00 per acre. Rs. 10,000.00 were paid as earnest money to him and it was agreed that the sale deed would be executed on or before 30/06/1968. The agreement recited that in case the vendor failed to execute the sale deed within the time prescribed he would be liable to pay to the vendees Rs. 10,000.00 the advance money and Rs. 10,000.00 more as damages. In case, the vendees failed to get the sale deed executed in their favour the vendor would forfeit the earnest money paid to him. It was further stated in the plaint that the vendor agreed to deliver vacant possession of the land at the time of execution of the agreement to sell but later on he found himself incapable of delivering the vacant possession since it was in possession of the tenants and, therefore, he failed to execute the sale deed in favour of the plaintiff and defendant No.2. On 26/06/1968, Sawan Mal gave a telegram to the plaintiff to get the sale deed executed. In reply to the telegram the plaintiff intimated Sawan Mal telegraphically that he had promised to deliver vacant possession and that he was ready to get the sale deed executed provided he (Sawan Mal) satisfied him that he would deliver Vacant possession of the land agreed to be said. Sawan Mal did not reply to this telegram but he was present in the office of Sub Registrar, Hisar on June 30, l968 to execute the sale deed. The vendees did not turn up and therefore, the sale deed could not be executed. The plaintiff further claimed that the amount in question was a charge on the property in question by virtue of S.55(6)(b) of the Transfer of Property Act and that he could recover this amount by sale of the property regarding which the agreement to sell was executed in his favour by Sawan Mal deceased.
3. Defendants Nos.1 and 3 to 10 contested the suit. The execution of the agreement to sell was not denied. It was, however, denied that defendant No.2 transferred his rights under the agreement to sell in favour of the plaintiff. It was denied that the vendor agreed to deliver vacant possession of the land in dispute. It was further pleaded that the plaintiff and defendant No.2 visited the land in dispute at the time of agreement and also verified from the entries in the revenue record that the same was in possession of tenants. Vendor Sawan Mal used to reside in Delhi in those days and the land in dispute was situated in village Talwandi Rana and it was known to the vendees that the tenants were in possession of the same. The vendor was not legally bound to deliver vacant possession of the land or get the deed of attornment executed from the tenants in favour of the plaintiff and defendant No.2. The plaintiffs claim for recovery of earnest money with interest was refuted. It was disputed if the amount can be a charge on the property in question. Defendants Nos.4 to 10 claimed themselves to be bona fide purchasers for consideration without any notice of the alleged agreement in favour of the plaintiff and defendant No.2. Personal liability of defendant No.2 for payment of the amount was also disputed.
4. The trial judge framed the following issues :-
1. Is the plaintiff not entitled to rescind the contract because the defendants did not deliver the possession to the plaintiff, nor obtained attornment from tenants on the suit property in favour of the plaintiff before the deed could be registered by the due date? OPD 2. If issue No.1 is decided against the defendant is the plaintiff not entitled to claim refund of earnest money? OPD 3. If issue N
