Supreme Court: A registered contract of sale is not automatically void during litigation.
Last Updated on December 17, 2024 by NewsDesk SLC
The Supreme Court stated that the mere fact that the registered sales contract was signed during the duration of the relevant litigation does not automatically make it invalid. Justices Vikram Nath and Satish Chandra Sharma said that although allowing the pendente lite transferee to implement is in any event a discretionary exercise which will enable the purchaser with an enforceable right to protect his interests, particularly if the transferor fails to do so. to defend an action or where there is a possibility of collusion.
The court reiterated the time-honored position that the doctrine of lis pendens under Section 52 of the Transfer of Property Act does not invalidate all transfers pendente lite ab-initio, it merely subordinates the rights arising from such transfers to law. parties to pending litigation and pursuant to any order the court may issue. He thus disposed of the appeal filed by Yogesh Goyanka against the Rajasthan High Court order dismissing the suit filed by him.
The appellant approached the High Court after the Additional District Court dismissed his application for implementation alleging that he had purchased the subject land measuring 2.38 acres in Hindaun, Rajasthan for a collective consideration exceeding Rs.1.51 cr.
Senior advocate C A Sundaram, appearing for the petitioner, argued that there is no bar to execution of pendente lite by the transferee even if the transferee had prior knowledge of the pendency. After paying the entire consideration, the petitioner obtained a purchase agreement in his favor and thus has the right to defend his interests on the subject land, he argued.
On the other hand, senior advocate V K Shukla argued for the plaintiff that the petitioner is not entitled to implement as he is not a bona fide buyer. He argued that although he was aware of the lien, permission was not sought in court to execute the contract of sale and therefore the applicant was not entitled to any relief.
The Supreme Court pointed out that the mere fact that the contract on registered sales was signed during the duration of the relevant litigation does not automatically make it invalid. “For this reason alone, we find the contested order to be completely erroneous, as Section 52 of the Act is used to cancel the ŘSD, and based on this, we conclude that the proposal to enforce the decision is unsustainable,” the court said. .
The court stated that it is a fact that the plaintiffs and the defendants are related. More importantly, the plaintiffs approached the court in the main suit with a considerable delay of 11 years, while the records of sales were amended from 2007 to include the name of respondent no. 21 (to whom the land was sold).
“Therefore, according to the considered opinion of this court, taking into account the totality of the circumstances of the case under consideration, including the fact that the main trial has not progressed substantially, the appellant has the right, in the interest of justice, to request in the main proceedings for the purpose of protecting his possible interests on the subject land,” the bench said
