IN THE HIGH COURT OF ALLAHABAD
TARUN AGARWALA
SURENDRA KUMAR - Appellant
Versus
AMARJEET SINGH - Respondents
Second Appeal 434 Of 2000
Decided On : 05/07/2004
Specific Performance - Auction Sale - Urban Land (Ceiling and Regulation) Act, 1976 - Registration Act, 1908 - The court held that the sale certificate was not exempt from registration and was required to be compulsorily registered. The unregistered sale certificate could not be enforced in a suit for specific performance of a contract for sale of an immovable property. The auction sale conducted by a private auctioneer was not a concluded contract and required registration to be enforced under the Specific Relief Act, 1963.
Fact of the Case:
The plaintiff filed a suit for specific performance alleging that the defendant Nos. 2 to 12 were the owners of the premises No. 79/7 Lathouche Road, kanpur Nagar. The plaintiff's bid was the highest in an auction, but the sale certificate was not registered. The trial court dismissed the suit, and the appellate court upheld the decision.
Finding of the Court:
The court found that the unregistered sale certificate could not be enforced in a suit for specific performance. The auction sale was not a concluded contract and required registration to be enforced under the Specific Relief Act, 1963.
Issues: The issues involved the enforceability of the unregistered sale certificate in a suit for specific performance and the nature of the auction sale as a concluded contract.
Ratio Decidendi: The court held that the unregistered sale certificate could not be enforced in a suit for specific performance, and the auction sale conducted by a private auctioneer was not a concluded contract and required registration to be enforced under the Specific Relief Act, 1963.
Final Decision: The second appeal was dismissed with costs as the unregistered sale certificate could not be enforced in a suit for specific performance.
( 1 ) THE plaintiff filed a suit for specific performance alleging that the defendant Nos. 2 to 12 were the owners of the premises No. 79/7 Lathouche Road, kanpur Nagar. They had appointed the defendant no. 13, Bharat Property Dealers, as the auctioneer to -sell the entire property no. 79/7 in seven different parts. The auctioneer advertised the seven parts of the premises for sale through an auction. Part one of the premises in question was put to auction on 23-6-1977. The plaintiffs bid of rs. 40. 000/- was the highest and was accepted by the auctioneer. A sum of Rupees 1000/- in cash and a sum of Rs. 9. 000/- by a cheque was paid by the plaintiff on the spot and a receipt was issued to the plaintiff. A sale certificate dated 23-6-77 was issued by the auctioneer in favour of the plaintiff. It was alleged that the defendant Nos. 2 to 12 were required to obtain the requisite permission from the prescribed authority under the urban Land (Ceiling and Regulation) Act, 1976 and, only thereafter, the sale deed was to be executed upon the receipt of the balance amount. The plaintiff further alleged that the defendant Nos. 2 to 12 obtained the permission to sell the property from the Prescribed authority and thereafter, surreptitiously executed a sale deed dated 20-8-77 in favour of defendant No. 1. When the plaintiff came to know about the execution of the sale deed, he served a notice dated 29-8-78 directing the defendants to execute the sale deed in favour of the plaintiff. The defendant no. 13 admitted the rights of the plaintiff, but expressed Its inability to get the sale deed executed on the ground that the defendant nos. 2 to 12 were not prepared to get the sale deed executed in favour of the plaintiff. It was alleged that the defendant No. 1 and his family members were present when the auction was conducted on 23-6-77 and in spite of knowing that the bid of the plaintiff was accepted, purchased the property fraudulently from the defendant Nos. 2 to 12. The plaintiff further stated that his father was already in possession of the property in question and, that the plaintiff was always ready and willing to perform his part of the contract. On the other hand the defendant nos. 2 to 13 were not willing to perform their part of the contract. Hence, the plaintiff by filing the suit for specific performance prayed that the defendants be directed to execute the sale deed pursuant to the auction sale held on 23-6-77 and deliver possession to the plaintiff.
( 2 ) THE defendant No. 1 filed his written statement and denied the plaint allegation. The defendant No. 1 denied that any auction was conducted on 23-6-77 and further denied that the bid of the plaintiff was accepted. The defendant further stated that he was not aware of any transaction taking place between the plaintiff and defendant Nos. 2 to 13. The defendant No. 1 contended that he was a bona fide purchaser for value and, had taken all the necessary precaution by inspecting the record of the Sub-Registrar and, after being fully satisfied that there was no impediment, purchased the said property vide a sale deed dated 20-8-77. The defendant no. 1 further contended that before purchasing the property, he had taken the con- sent from the plaintiffs father, who had assured him that he would vacate the premises as he had no requirement of the building and, that he had shifted his entire transport business to the Transport Nagar. Based on this assurance, the defendant No. 1 purchased the property In question. The defendant No. 1 further alleged that the plaintiff and defendant nos. 2 to 13 have colluded and brought this suit in order to harass the defendant and to pay a huge premium for getting the premises vacated.
( 3 ) THE defendant Nos. 6 and 7, in their written statement, admitted that they had appointed the auctioneer to sell the property through an auction. The defendant admitted that the plaintiffs bid of Rs. 40. 000/- was the highest and that he had paid
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