C.R. No. 3385 of 2006 -1- ***** IN THE PUNJAB AND HARYANA HIGH COURT AT CHANDIGARH C.R. No. 3385 of 2006 (O&M) Date of Decision : 03.08.2010 Kulbhushan Kumar & another .......... Petitioners Versus Suresh Kumar & others ...... Respondents CORAM : HON'BLE MR. JUSTICE VINOD K. SHARMA Present : Mr. Arun Jain, Sr. Advocate with Mr. Amit Jain, Advocate for the petitioners. Mr. A.K. Chopra, Sr. Advocate with Mr. Rajneesh Chauhan, Advocate for respondents No. 1 & 2. ****** 1. Whether Reporters of Local Newspapers may be allowed to see the judgment? 2. To be referred to the Reporters or not? Yes. 3. Whether the judgment should be reported in Digest? Yes. ****** VINOD K. SHARMA, J. The defendant / petitioners have invoked the jurisdiction of this Court under Article 227 of the Constitution of India for quashing the order dated 27.1.2006, passed by the learned Addl. District Judge, Gurdaspur, allowing an application moved by the plaintiff / respondents under Order 39 Rules 1 & 2 of the Code of Civil Procedure. C.R. No. 3385 of 2006 -2- ***** The plaintiffs / respondents filed a suit for proprietary possession (the actual possession being already with the plaintiffs ) by ordering the defendants to specifically perform the agreement to sell dated 10.7.2004, regarding the property i.e. plot measuring 19 Marlas i.e. ½ share of plot measuring 38 Marlas, bearing Khasra No. 22R/21 Min and 22R/21/1/1/2, situated at Jalandhar Road Batala Garbhi Batala shown in pink and worded as ABCD in the plan attached with the plaint, with all rights pertaining thereto of all descriptions for a sale consideration of Rs. 5,00,000/- (Rupees five lac only), which already stood paid to defendant No.1, (as detailed in the body of the plaint) or in the alternative suit for recovery of Rs. 5,00,000/- (Rupees five lac only). The suit filed by the plaintiffs was based on agreement to sell dated 10.7.2004, said to have been executed by Smt. Sonia Aggarwal, agreeing to sell land measuring 19 Marlas, which was shown to be bounded on East by Sarbjeet Singh, on West by Ayodhya Nath, on North by Harinder Pal (Harinder Pal Singh), on South by passage bearing Khasra Nos. 22R/21 Min, 22R/21/1/1/2, 4/1, for the sale consideration of Rs. 5,00,000/- (Rupees five lac only). In the agreement to sell, it was mentioned that : “In this way after the receipt of the entire sale consideration, the possession has been delivered to the vendees and from today I and any of my family members have left no right, title and interest in this property....” C.R. No. 3385 of 2006 -3- ***** The plaintiffs / respondents also prayed for grant of temporary injunction restraining the defendants including the petitioners herein from interfering in their possession. It was also the case of the plaintiffs / respondents that they were in actual physical possession of entire plot, which was originally owned and possessed by one Dalbir Singh s/o Pargan Singh, who sold ½ share of the plot, fully detailed above, in favour of plaintiff No.1, Suresh Kumar and Smt. Neeru Aggarwal, wife of plaintiff No.1, vide sale deed dated 14.7.2003, for a sale consideration of Rs. 4,75,000/- (Rupees four lac and seventy five thousand only), and delivered possession thereof to plaintiff etc. On that very day, Dalbir Singh sold the remaining ½ share of the plot in favour of defendant No.1, Sonia Aggarwal by way of registered sale deed dated 14.7.2003, for a sale consideration of Rs. 4,75,000/- (Rupees four lac and seventy five thousand only). Plaintiff, Suresh Kumar appeared on behalf of Sonia Aggarwal to take possession of the plot. The case of the plaintiffs was, that all 38 Marlas of land were in possession of Suresh Aggarwal and his wife. It was also pleaded by plaintiff No.1, that he contributed a sum of Rs. 1,00,000/- (Rupees one lac only) from his side towards sale consideration, for the sale deed executed in favour of defendant No.1, as she could not arrange this amount. It was the case of the plaintiffs, that defendant No.1 thereafter agreed to sell the plot purchased by her to the plaintiffs / C.R. No. 3385 of 2006 -4- ***** respondents. It was also pleaded case of the plaintiffs / respondents, that they were always willing and still willing to perform their part of contract to get the sale deed executed. The plea was also raised, that the boundary wall has been raised around the plot and gates have been installed therein. The case of the plaintiffs / respondents further was, that the sale deed executed by defendant No.1 in favour of defendant No.2 to 7 was illegal, invalid, null and void, sham, bogus and without consideration being result of collusion and conspiracy, which did not create any right or interest in favour of the vendees. The plaintiff / respondents pleaded, that the defendants had threatened to interfere in their possession illegally and forcibly, therefore, prayed for injunction by claiming, that plaintiff / respondents had a prima facie in their favour and the balance of convenience was also in their favour, and that the plaintiff / respondents were likely to suffer irreparable loss, if injunction was not granted. Along with the suit the plaintiff / respondents filed an application under Order 39 Rules 1 & 2 of the Code of Civil Procedure for interim injunction. The suit was contested by the petitioners, as well as defendant No.1, and the interim injunction application was opposed on the grounds taken in the written statement. The stand of defendant No.1 was, that Dalbir Singh never delivered the exclusive C.R. No. 3385 of 2006 -5- ***** possession of the entire plot to plaintiff No.1 and his wife, as alleged. The case of the plaintiffs was, that by purchase of the half share of the plot in dispute, they had become co-sharers to the extent of ½ share, as the ½ share was purchased by defendant No.1 vide sale deed dated 14.7.2003. Defendant No.1 denied that a sum of Rs. 1,00,000/- (Rupees one lac only) was contributed by plaintiff No.1 towards sale consideration. The case of defendant No.1 was, that plaintiff, Suresh Kumar was asked to represent her, as her agent, at the time of execution of the sale deed, and she was fully dependent upon plaintiff No.1. She claimed, that she was in actual possession of ½ share after execution of the sale deed, and possession of the plaintiff No.1 along with his wife was denied. She also denied having executed agreement dated 10.7.2004, which was basis for filing of the suit, by claiming it to be fictitious document. She admitted, that the property i.e. 19 Marlas of land purchased by her was sold to defendants No. 2 to 7 vide registered sale deed dated 25.2.2005. It was claimed, that defendants No. 2 to 7 were in actual physical possession of the plot sold by the defendant No.1 in their favour. Other averments were denied. Defendants No. 2 to 7 filed a separate written statement, by raising same pleas, as raised by defendant No.1. It was claimed, that mutation was sanctioned in favour of defendant No.1, and she was recorded as owner to the extent of ½ share of 38 Marlas. The C.R. No. 3385 of 2006 -6- ***** defendants claimed, that they had purchased ½ share from Sonia Aggarwal, and at the time of execution of the sale deed, possession was delivered to them, and thus the defendants have become co- sharer to the extent of ½ share. The agreement dated 10.7.2004 was said to be false, forged and fictitious document. The defendants claimed to be in actual physical possession. In support of the case, the plaintiffs filed site plan in original, copy of the agreement to sell dated 10.7.2004, copies of the cheque and demand drafts and copy of the sale deed dated 14.7.2003 and copy of jamabandi. As against this, the defendants No. 2 to 7 have placed on record the sale deed dated 25.5.2005 and also the mutation sanctioned in their favour. In support of the application, the plaintiff / respondents contended that they were owner to the extent of ½ share, whereas they were in possession of other ½ share, on the basis of the agreement to sell executed by defendant No.1, after payment of full sale consideration, therefore, the defendants No. 2 to 7 had no right to interfere in their possession. The defendant / petitioners, on the other hand, contended that defendant No.1 was owner to the extent of ½ share, she was in possession of ½ share of land, and that they had purchased the land from defendant No.1 vide sale deed dated 25.2.2005, therefore, they became co-owner in possession to the extent of their share, therefore, the plaintiffs have no right to seek injunction against them. C.R. No. 3385 of 2006 -7- ***** The learned trial Court dismissed the application for injunction by recording as under :- “It is well settled that agreement to sell does not confer any right, title or interest of the property in favour of the vendees and no injunction can be issued against a lawful owner of the property. As such, I find that the plaintiffs have no prima facie case at this stage, balance of convenience also does not lie in their favour and no irreparable loss or injury is going to be caused if the injunction prayed for by the plaintiffs is not granted at this stage. Accordingly, I find no merit in this application and the same is ordered to be dismissed. However, nothing said and observed in this order shall prejudice to decision of the suit on merits.” The plaintiff / respondents preferred an appeal against the order passed by the learned trial Court. The learned lower appellate Court accepted the appeal, by recording a finding, that the documents showed, that defendant No.1 had executed the sale deed dated 25.2.2005, in favour of defendants No. 2 to 7. As per the sale deed, defendants No. 2 to 7 became co-sharers, but question was whether defendants No. 2 to 7 were in actual possession of ½ share of plot measuring 38 Marlas. The learned lower appellate Court concluded, that in view of the stand taken by defendants, that they are co-sharers in possession to the extent of ½ share showed, that they were not in actual physical possession of the plot measuring 38 Marlas. C.R. No. 3385 of 2006 -8- ***** The learned lower appellate Court also held, that it was yet to be seen after the evidence is led, as to whether property was purchased from defendant No.1, despite the knowledge of agreement to sell dated 10.7.2004, and that the property was purchased for valuable consideration, without notice of agreement to sell dated 10.7.2004. In case the Court opines, that the agreement to sell dated 10.7.2004 was rightly executed but respondents No. 2 to 7 purchased the property without notice of agreement to sell dated 10.7.2004, then the sale deed dated 25.2.2005 is to be upheld. However, in case the Court comes to the conclusion, that defendants No. 2 to 7 purchased the property despite notice of agreement to sell dated 10.7.2004, then the sale deed dated 25.2.2005 is to be ignored, but at present the question was whether defendants were in actual possession of the property in dispute. The learned lower appellate Court held, that the defendants had moved an application before the SSP, Batala which showed, that the defendants were in possession of the plot in dispute. The learned lower appellate Court also held, that defendants No. 2 to 7 had filed a suit for permanent injunction against the plaintiffs / respondents, on the allegation, that they were in actual possession of the entire plot in dispute, which means that defendants were not clear whether they were in actual possession of half of the plot or they were in possession of entire plot measuring 38 Marlas. The learned lower appellate Court also held, that the site plan of the plaintiffs / respondents tallied with the plans submitted by C.R. No. 3385 of 2006 -9- ***** the defendant / petitioners. The learned lower appellate Court also took note of the settled law, that no injunction can be issued against the lawful owner of the property, and that the agreement to sell does not confer any right, title or interest on the willing purchaser, but held that this principle of settled law was not applicable to this case. The learned lower appellate Court thereafter was pleased to hold, that in a suit on the basis of agreement to sell when the vendees are not put in possession, and seek restraining the interference of cultivation or in possession, no legal right vests in the plaintiff qua the property in dispute, as the plaintiff was not to suffer any irreparable loss or injury if the stay is not granted. The learned lower appellate Court also took note of the law, that the agreement to sell does not create any title, or interest in the proposed vendees the property, because title in the immovable property of the value of more than Rs. 100/- can be conveyed only by way of registered sale deed; and that holder of the agreement to sell was not entitled to protection under Section 53-A of the Transfer of Property Act against the original owner. The learned lower appellate Court, however, did not agree with the settled law, because of the fact, that ½ share of the plot measuring 38 Marlas was purchased by the plaintiff / respondents, and possession was delivered, whereas the remaining ½ share was sold to defendant No.1, who was not present at the time of sale deed and it was plaintiff No.1, who was present at the time of C.R. No. 3385 of 2006 -10- ***** sale in favour of defendant No.1, therefore, it was not clear to which side the actual possession was of defendant No.1. Similarly, in the sale deed dated 25.2.2005, it was not clear as to which portion measuring ½ share was in the possession of the vendees. The learned lower appellate Court held, that the plaintiffs / respondents had paid entire sale consideration, as per the agreement to sell dated 10.7.2004, and actual possession of the plot was with the plaintiffs / respondents, therefore, they were likely to suffer irreparable loss, if they are ousted of the possession. The learned lower appellate Court held, that the defendants / petitioners could get possession by way of partition and not forcibly. The learned lower appellate Court, therefore, held that even if the agreement to sell was to be ignored, still the question would be, as to who was in actual possession of the property and of which portion. The learned lower appellate Court thereafter concluded, that though the contract of sale does not create any interest or any charge on the property, yet the contract of sale was not mere agreement to sell, but more because technically the transaction was complete in all respects, except execution of sale deed and registration thereof. The agreement of sale creates an interest in the property, and is protected under Section 53-A of the Transfer of Property Act. The learned lower appellate Court thereafter took into consideration, the payment said to have been made by the plaintiffs / respondents to defendant No.1 at the time of agreement to sell. The C.R. No. 3385 of 2006 -11- ***** learned lower appellate Court was of the view, that it was not clear, as to which portion was in occupation of the respective co-sharers. In view of the findings, referred to above, the learned appellate Court recorded a finding, that relief of injunction is discretionary, which should be exercised judicially. The order of the learned appellate Court could be set aside, if it is perverse, against law and not to be set aside lightly. In view of the finding of the learned appellate Court, that plaintiff / respondents were in actual possession of entire plot, as per the agreement to sell, on payment of total sale consideration, they were to suffer irreparable loss, if the stay was not granted. The learned appellate Court also held, that prima facie case is in favour of the plaintiffs / respondents, and consequently set aside the judgment of the learned trial Court, and allowed the application for interim injunction. Mr. Arun Jain, learned senior counsel appearing on behalf of the petitioners contended, that the judgment of the learned appellate Court is perverse, being outcome of misreading of documents, and evidence on record. The learned senior counsel for the petitioners referred to the sale deed executed in favour of Sonia Aggarwal, defendant No.1 by Dalbir Singh, who was owner of 38 Marlas of land, who sold the property by way of two registered sale deeds one in favour of defendant No.1 and another plaintiff No.1 and his wife. C.R. No. 3385 of 2006 -12- ***** In the sale deed in favour of defendant No.1 it was mentioned that :- “...Whereas I am owner in possession of land measuring Ninteen Marlas (0-19) Marlas i.e. ½ share of land measuring one Kanal Eighteen Marlas (1K-18M) entire measurement towards South by 46 ft. 4 Inch. towards North 46 ft. 4 Inch. towards East 213 ft., towards West 237 ft. bounded on South by passage, on North by Harinder Pal Singh etc., on east Sarabjit Singh etc., on West by Ayudhia Nath bearing khasra Number 22R/21 Min situated at Batala Garbi, Tehsil Batala....” It was also mentioned in the sale deed that : “.....Possession has been delivered. The vendees have become the absolute owners of the above mentioned land. Mutation shall be sanctioned. In case of any defect in my ownership, lawful title or dispossessed from the above mentioned land then I shall be responsible to pay the sale expenses and damages and my property of all kinds will be responsible....” The sale deed executed in favour of plaintiff No.1 and his wife also described the portion sold to plaintiff / respondents. The contention of the learned senior counsel for the petitioners, therefore, was that the learned lower appellate Court committed an error in coming to the conclusion, that it was not shown as to which portion was in possession of respective parties. C.R. No. 3385 of 2006 -13- ***** The contention of the learned senior counsel for the petitioners was that this is misreading of the sale deed produced on record. It was also the contention of the learned senior counsel for the petitioners, that the learned lower appellate Court wrongly recorded ,that there was prima facie case in favour of the plaintiff / respondents, though the suit was based on agreement to sell, against the petitioners, who were registered owners of the plot, the possession of which was handed over at the time of sale deed. Mr. A.K. Chopra, learned senior counsel appearing on behalf of the respondent / plaintiffs contended, that in the sale deed executed by Sonia Aggarwal, proprietary possession was given and not actual possession, therefore, the defendant / petitioners can not claim to be in possession. The learned senior counsel for the petitioners, on the other hand, contended, that in view of the registered sale deed being in favour of the defendants / petitioner, and also the fact, that Sonia Aggarwal was given possession of the property by Dalbir Singh, though, through plaintiff No.1 acting as her agent, she was in actual physical possession, therefore, she could deliver possession to the petitioners which she actually did. The contention of the learned senior counsel for the petitioners, therefore, was that the balance of convenience was in favour of the defendant / petitioners, and it is the defendants, who were likely to suffer irreparable loss because of the injunction, as the C.R. No. 3385 of 2006 -14- ***** plaintiffs could not claim any right in the land in dispute, on the basis of agreement to sell. It was, therefore, prayed that the revision be allowed and impugned order be set aside. Mr. Ashwani Chopra, learned senior counsel appearing on behalf of the respondents contended, that Dalbir Singh, the original owner of the property, had executed two sale deeds, one in favour of defendant No.1 and other in favour of plaintiff No.1 and his wife. Smt. Sonia Aggarwal, defendant No.1 admittedly was not present at the time of execution of the sale deed, therefore, could not claim to be in actual possession of the plot, which was sold to the defendant / petitioners. It was also vehemently contended by the learned senior counsel for the plaintiff / respondents, that the very fact, that the defendant / petitioners earlier filed a suit for injunction claiming possession over whole of the plot shows, that the learned appellate Court was right in recording a finding, that the defendant / petitioners were not aware as to which property was in their possession. The learned senior counsel for the plaintiffs / respondents placed reliance on the observations made by the learned appellate Court while accepting the appeal, which has been reproduced above, to contend, that the plaintiffs / respondents had prima facie case, and the defendants have no right to interfere in their possession. On consideration, I find no force in the contentions raised by the learned counsel for the plaintiffs / respondents. It is not open to the plaintiff / respondents to claim, that defendant No.1 did not C.R. No. 3385 of 2006 -15- ***** come in possession, in view of the sale deed executed in her favour, where plaintiff No.1 represented her, as her agent. The possession taken by the plaintiff No.1 / respondent on behalf of Sonia Aggarwal was in fact possession of Sonia Aggarwal, and the plaintiff No.1, is estopped to deny the title or the possession of the principal having acted as her agent. The learned appellate Court was also wrong in coming to the conclusion, that it was not clear, as to which portion was sold to defendant No.1 and plaintiff No.1 and his wife. This finding is perverse, as in the sale deed, the specific area was sold to defendant No.1, and that fact was admitted by plaintiff No.1, while acting as her agent. The possession of vacant land goes with the ownership, therefore, defendant No.1 was competent to transfer the possession to the vendees / defendants No. 2 to 7, when she executed the registered sale deed. The learned appellate Court also committed an error in coming to the conclusion, that plaintiffs / respondents were entitled to protection under Section 53-A of the Transfer of Property Act, because they had paid the whole sale consideration under agreement to sell. It may be noticed, that in the agreement to sell it was mentioned, that possession was handed over to the plaintiffs / respondents, this again can be taken as an admission, that defendant No.1 was in exclusive possession of the portion sold to her, otherwise there was no occasion to claim, that the possession C.R. No. 3385 of 2006 -16- ***** was taken by the plaintiffs / respondents under the agreement to sell. The learned lower appellate Court wrongly paid importance to the agreement to sell to hold, that there was prima facie case in favour of the plaintiffs / respondents by ignoring Section 17 of the Registration Act, as amended in 2001. The relevant portion of Section 17 of Registration Act necessary for decision of this case reads as under :- “17. Documents of which registration is compulsory:- (1) the following documents shall be registered, if the property to which they relate is situate in a district in which, and if they have been executed on or after the date on which, Act No. XVI of 1864, or the Indian Registration Act, 1866, or the Indian Registration Act, 1871, or the Indian Registration Act, 1877,or this Act came or comes into force, namely (a) xx xx xx xx (b) xx xx xx xx (c) xx xx xx xx (d) xx xx