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2025 Supreme(Telangana) 375
IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD
G.RADHA RANI, J.
Smt. J. Sharada Bai Hyderabad - Appellant
Versus
Subhadra Bai And Ors Hyderabad - Respondent
City Civil Court Appeal Nos.119 and 155 Of 2006
Decided On : 02-05-2025
Advocate Appeared:
For the Appellant : JAGATHPAL REDDY KASI REDDY
For the Respondent: M A K MUKHEED
A sale deed can be cancelled if the full consideration is not paid, and the doctrine of lis pendens applies to transfers made during pending litigation.
Headnote:(A) Specific Relief Act, 1963 - Section 31 - Transfer of Property Act, 1882 - Section 54 - Cancellation of sale deed - Plaintiff sought cancellation of sale deed executed in favor of defendant No.1 due to non-payment of full consideration - Court found that the sale deed was conditional upon payment and that the plaintiff had not received the full amount, thus entitled to cancellation. (Paras 41, 42, 44)
(B) Doctrine of Lis Pendens - The court held that the transfer of property by defendant No.1 to defendant No.2 was subject to the outcome of the pending litigation, thus not protecting the rights of the bonafide purchaser. (Paras 44, 46)
Facts of the case:
The original plaintiff filed a suit for cancellation of a sale deed executed in favor of defendant No.1, claiming that the sale was conditional upon the payment of full consideration, which was not made. The plaintiff alleged collusion between the defendant and his former counsel regarding the payment. (Paras 1-3)
Findings of Court:
The court found that the plaintiff had not received the full sale consideration and that the sale deed was subject to the condition of payment. The court also ruled that the doctrine of lis pendens applied to the transfer to defendant No.2. (Paras 41-46)
Issues: The main issues included whether the suit was bad for non-joinder of necessary parties and whether the sale deed could be cancelled due to non-payment of consideration. (Paras 14-15)
Ratio Decidendi: The court ruled that the sale deed could be cancelled if the full consideration was not paid, and that the doctrine of lis pendens applied to the transfer of property during the pendency of litigation. (Paras 41-44)
Result: Appeals dismissed, confirming the trial court's judgment. (Para 46)
JUDGMENT :
(G. RADHA RANI, J.)
CCCA No.119 of 2006 is filed by the appellant-defendant No.1 and CCCA No.155 of 2006 is filed by the appellant-defendant No.2 aggrieved by the judgment and decree dated 25.04.2006 passed by the IV Senior Civil Judge, City Civil Court, Hyderabad in O.S. No.28 of 1997.
2. The respondent Nos.2 to 5 were the wife and children of the original plaintiff Sri Narsing Rao Chavan. The original plaintiff (plaintiff No.1) died and as per the orders in I.A. No.1741 of 2002 the respondent Nos.2 to 5 were brought on record on 06.01.2003. Initially, the suit was filed by the original plaintiff against defendant No.1 alone. Subsequently, defendant No.2 was also impleaded in the suit as per the orders in I.A. No.283 of 2002 dated 02.12.2003.
3. The suit was filed for cancellation of sale deed dated 26.05.1995 registered as document No.2358 of 1995 in respect of a portion of a house bearing No.4-6-260 to 264 admeasuring 92.5 sq. yds., situated at Esamiabazar, Hyderabad. The plaintiff contended that originally the house property bearing No.4-6-259, 261 to 264 (old) and presently bearing Municipal No.4-6-260 to 264 admeasuring 185 square yards situated at Esamiabazar, Hyderabad, was owned and possessed by late D. Jagannath Rao, who purchased the same under document No.931 of 1987 and he died intestate leaving behind him, his wife Smt. D. Godavari Bai. Smt. D. Godavari Bai also died on 07.03.1994. They had no issues. During her lifetime, Smt. Godavari Bai executed a Will bequeathing the aforesaid properties in favour of the plaintiff No.1, who was her natural brother. One Smt. G. Prameela Bai, wife of G. Mohan Rao (the sister’s daughter of Smt. Godavari Bai) also claimed right of ownership in and over the property claiming that she was the adopted daughter of Smt. Godavari Bai and filed a suit for injunction bearing O.S. No.1831 of 1994 on the file of III Assistant Judge, City Civil Court, Hyderabad. The matter was settled between the plaintiff No.1 and G. Prameela Bai out of court inter alia agreeing to share the property equally and the said suit was withdrawn. Smt. G. Prameela Bai and the plaintiff jointly sold a portion of the aforesaid property admeasuring 92.5 sq.yds., in favour of the son of defendant No.1. As per the settlement, the entire sale consideration was paid to Smt. G.Prameela Bai. As per the settlement, the remaining half property i.e. H.No.4-6-260 to 264 admeasuring 92.5 sq.yds., (the suit schedule property) was conveyed to defendant No.1 under registered sale deed document No.2358 of 1995. The sale transaction agreed in respect of the suit schedule property was Rs.2,00,000/- (Rupees Two lakhs only). The defendant paid Rs.50,000/- i.e. Rs.25,000/- on 24.04.1995 on the date of the agreement and Rs.25,000/- on 28.05.1995 to the plaintiff as he was alone entitled to receive the entire sale consideration amount pertaining to the plaint schedule property. But, for the best reasons known to defendant No.1, the sale consideration amount was shown in the sale deed as Rs.1,90,000/-. The defendant issued two post-dated cheques on 26.05.1995 on the date of registration of Sale Deed, one cheque bearing No.651851 dated 25.06.1995 for Rs.25,000/- and the second cheque bearing No.651853 dated 25.08.1995 for Rs.1,25,000/-, both drawn on Andhra Bank, Hyderabad in favour of the plaintiff. The plaintiff in good faith accepted the said two post-dated cheques. As per the terms of the sale deed, in case the cheques or any one of the two cheques were not honoured for want of any reason, the sale transaction would become null and void in respect of the Schedule property and the plaintiff had got every right to cancel the sale deed and in such event, the defendant would have no right to take any kind of excuse or objection. The defendant No.1 was fully aware of the said terms embodied in the sale deed.
3.1. The plaintiff further averred that Sri V.Rajagopal was his counsel in O.S. No.1831 of 1994 and also in R.C.Nos.492 of 1994,
