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1960 Supreme(MP) 238

High Court Of Madhya Pradesh
T. C. Shrivastava and S. P. Bhargava, JJ.
MUNNILAL SHYAMLE - Appellant
Versus
BHAIYALAL HAZARI - Respondents
Letter Patent Appeal 102 Of 1958
Decided On : 08/29/1960

Advocates Appeared:
B.L.SETH, R.K.Pandey

A sale in pursuance of a prior agreement to sell is hit by Section 52 of the Transfer of Property Act.

Headnote:

TRANSFER OF PROPERTY ACT - SECTION 52 - SALE PENDING SUIT - EFFECT - SALE IN PURSUANCE OF PRIOR AGREEMENT TO SELL - WHETHER HIT BY SECTION 52 - HELD, YES.

Fact of the Case:

Plaintiffs (respondents 1 and 2) claimed that they had entered into an agreement to purchase the suit properties from the owner (respondent No. 3) on 20-9-1953 and had taken possession of the same. On 30-9-1953, the owner contracted to sell the same properties to the defendants (appellants). The defendants filed a suit for specific performance against the owner and obtained a decree. The plaintiffs were dispossessed from the land in execution of the decree. The plaintiffs filed a suit for possession, claiming that the sale in favor of the defendants was hit by Section 52 of the Transfer of Property Act.

Finding of the Court:

The trial Court dismissed the suit, holding that the plaintiffs' contract was ante-dated and entered into after the contract with the defendants, with full knowledge of that contract. The lower appellate Court reversed the findings of the trial Court and held that the agreement in favor of the plaintiffs was real, genuine, and for consideration. It further held that the defendants took the subsequent agreement with knowledge of the agreement in favor of the plaintiffs. Accordingly, it held that the doctrine of lis pendens did not apply to the case and under Section 40 of the Transfer of Property Act, the defendants could not claim possession of the lands as against the plaintiffs.

Issues: Whether a sale in pursuance of a prior agreement to sell is hit by Section 52 of the Transfer of Property Act.

Ratio Decidendi: Section 52 of the Transfer of Property Act provides that the property in suit cannot be transferred or otherwise dealt with by any party to the suit, so as to affect the rights of any other party thereto under any decree or order which may be made therein. A sale which takes place after the institution of the suit in pursuance of a prior agreement to sell is hit by Section 52 of the Transfer of Property Act. The doctrine of lis pendens applies only to a transfer pendente lite, but it cannot affect a pre-existing and subsisting right. If the sale is a transfer in recognition of a pre-existing and subsisting right, it would not be affected by the doctrine, as the said transfer did not create a new right pendente lite.

Final Decision: The decision of the learned single Judge dismissing the second appeal is set aside. The appeal shall now be heard as a second appeal on other grounds raised by the appellants.

SHRIVASTAVA J. ( 1 ) THIS Letters Patent appeal has been filed against the judgment of a single Judge of this Court (Chaturvedi J.) in Second Appeal No. 278 of 1957.

( 2 ) THE suit out of which that second appeal arose was filed by respondents 1 and 2 (Bhaiyalal and Bhajni) against the appellants Munnilal and Ramdayal as defendants 1 and 2 and respondent No. 3 Bharosa as defendant No. 3. For convenience we shall refer to respondents 1 and 2 as the plaintiffs and the appellants Munnilal and Ramdayal as the defendants.

( 3 ) THE subject-matter of the suit was 29. 29 acres of land, situated in Khiria khawas, Tahdil Rebli District Sagar, as also a house in that village. These properties belonged to Bharosa (respondent No. 3 ). On 30-9-1953 he contracted to sell these properties to the defendants. On 3-10-1953 the defendants gave a notice to the plaintiffs and others that they were purchasing the suit properties from Bharosa. On 2-12-1953 they filed a suit for specific performance against bharosa and that suit was decreed. In April 1955, the defendants, dispossessed the plaintiffs from the land in execution of the decree obtained in the suit for specific performance.

( 4 ) THE plaintiffs' (respondents 1 and 2) case was that on 20-9-1953, i. e. , 10 days prior to the contract in favour of the defendants, Bharosa had contracted to sell the suit properties to them and had taken Rs. 600/- as part payment towards the sale price. The agreement was to execute a sale-deed within two months from that date. Such a sale-deed was executed in their favour on 25-1-1954. They continued in possession of the suit properties thereafter till they were dispossessed in April 1955 by the defendants. The plaintiffs, therefore, prayed that the decree obtained by the defendants in the suit for specific performance of the contract was not binding on them and they were entitled to get back possession of the suit properties.

( 5 ) THE defendants resisted the suit on the ground that the contract, dated 20-91953, was really entered into to defeat their claim on the basis of the contract dated 30-9-1953. According to them, it was an ante-dated document without consideration. They further contended that the sale-deed, dated 25-1-1954, which was executed during the pendency of the suit for specific performance, was hit by section 52 of the Transfer of Property Act and was not, therefore, binding on them.

( 6 ) THE trial Court dismissed the suit upholding the contentions of the defendants that the plaintiffs' contract was ante-dated and was entered into on 2-10-1953 after the contract with the defendants and with full knowledge of that contract. The Court also held that as the transfer was pendente lite, the plaintiffs were bound by the result of the suit for specific performance. The lower appellate Court, however, reversed these findings of the trial Court and concluded that the agreement, dated 20-9-1953 was real, genuine and for consideration. It further held that the defendant's took the subsequent agreement, dated 30-9-1953, with the knowledge of the agreement in favour of the plaintiffs. Accordingly, it held that the doctrine of lis pendens did not apply to case and under Section 40 of the transfer of Property Act the defendants could not claim possession of the lands as against the plaintiffs. The suit was accordingly decreed. In second appeal, though the appellants had raided several grounds, the appeal was decided only on the question whether the transaction in favour of the plaintiffs was hit by Section 52 of the Transfer of Property Act. The learned single Judge came to the conclusion that that section did not apply to the facts of the case. The appeal was accordingly dismissed and it is against that decision that the defendants 1 and 2 have filed this Letters Patent appeal.

( 7 ) SECTION 52 of the Transfer of Property Act provides that the property in suit cannot be transferred or otherwise dealt with by any party to the suit, so as to affect the right















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