1972 Supreme(All) 293

Allahbad High Court
T.S.MISRA
Jagar Nath - Appellant
Versus
Chhedi Dhobi - Respondent
Decided On : 12/12/1972

Headnote:

SPECIFIC PERFORMANCE OF CONTRACT - SALE OF HOUSE - AGREEMENT TO SELL - VAGUENESS - RULE OF PERPETUITY - RESTRAINT ON ALIENATION - SECTION 10 AND 14 OF THE TRANSFER OF PROPERTY ACT - APPLICABILITY.

Fact of the Case:

Plaintiff sued for specific performance of a contract of sale of a house and for a declaration that the 'bara' situated to the south of his house was never sold by him to the defendant No. 1. It was alleged that the plaintiff had sold the house to Purshottam on the condition that Purshottam and his heirs might continue in possession of the house for any length of time and in case they ever desired to sell the same, they would first offer the same for sale to the plaintiff or his heirs and on his refusal to purchase the same they could sell it to any third person. Purshottam, however, did not abide by that condition and sold the house to Chhedi Dhobi, defendant No. 1 for a sum of Rs. 700.00 without first offering the same to the plaintiff. Purshottam also included in the sale deed the plaintiff's Bara which had never been sold to Purshottam and of which he was not the owner.

Finding of the Court:

The trial court dismissed the suit for specific performance of contract of sale but granted the decree for possession over the Bara land. The appellate court below also dismissed the appeals filed by both the plaintiff and the defendant No. 1. The High Court allowed the plaintiff's appeal and set aside the decree passed in the Civil Appeal No. 20 of 1962, Jagar Nath v. Chhedi Dhobi and decreed the suit. The cross-objection filed by Chhedi Dhobi, the defendant No. 1, was dismissed.

Issues: 1. Whether the agreement to sell as contained in the sale deed was vague and offended against the rule of perpetuity? 2. Whether the provisions of Section 10 and 14 of the Transfer of Property Act were applicable to the facts and circumstances of the case?

Ratio Decidendi: 1. The agreement to sell was not vague as it provided that Purshottam had to offer the house first to Jagar Nath or his heirs, as the case may be, and if they failed to purchase the same within a reasonable time, Purshottam had the right to sell the same to any person he liked. The price at which the house was to be resold to Jagar Nath was also not left indeterminated inasmuch as Purshottam was given a right to sell the house at a reasonable price. 2. The rule against perpetuity as embodied in Section 14 of the Transfer of Property Act does not apply to personal contracts which do not create rights of property. The agreement in the instant case was not a transfer of property and therefore, Section 14 had no applicability. 3. The provisions of Section 10 of the Transfer of Property Act also do not apply to the facts and circumstances of the instant case as the agreement in question did not provide for an absolute restraint on alienation.

Final Decision: The appeal filed by the plaintiff was allowed with costs and the cross-objection filed by Chhedi Dhobi, the defendant No. 1, was dismissed. The decree passed in the Civil Appeal No. 20 of 1962, Jagar Nath v. Chhedi Dhobi was set aside and the suit was decreed.