spb/- 1 ao672-10.sxw IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE SIDE JURISDICTION APPEAL FROM ORDER NO. 672 OF 2010 ALONGWITH CIVIL APPLICATION NO. 861 OF 2010 IN A.O. NO.672 /2010 1. Vijay Charanjitlal Chaddha & Anr. ... Appellants. (Org.Defendants) Vs. Mr. Motilal Ghanshyamdas Milani, through his power of attorney holder : Mr. Ghanshyamdas Morumal Sidhani ... Respondent. --- Mr. G.S. Godbole i/by Puroshttam G. Chavan for the Appellants. Mr. Vinod Tayade for the Respondent. ----- CORAM : D. G. KARNIK, J. DATE : 09th DECEMBER, 2010. P.C. 1 Admit. 2 Mr. Vinod Tayade, Advocate, waives service of notice on behalf of the Respondent. 3 By consent taken up for hearing forthwith. 4 The Appeal is directed against an order dated 28th October, 2009 passed by the 7th Jt. Civil Judge, S.D., Pune, allowing the application for spb/- 2 ao672-10.sxw injunction filed by the respondent (original plaintiff). 5 The respondent was the owner of the suit property. By a registered sale deed dated 31.08.2005, the respondent sold, transferred and conveyed the suit property to the appellants for a consideration of Rs. 15,50,000/-. According to the respondent out of total consideration of Rs.15,50,000/-, the appellants had paid to the respondent only a sum of Rs. 5,00,000/- at the time of execution of the sale deed and for balance of Rs.10,50,000/-, issued three post-dated cheques. Out of the three post-dated cheques, only one cheque amount to Rs. 2,50,000/- was honoured by the Bank when presented for payment. Remaining two cheques for Rs.8,00,000/- in all were dishonoured when presented for payment. The respondent, therefore, filed a suit for rescinding the sale deed dated 31st August, 2005 and for a declaration that the sale deed was not binding on him. He also prayed for a decree for possession and injunction against the appellants. During the pendency of the suit, the respondent made an application for interim injunction to restrain the appellants from selling, transferring and or creating third party interest in the suit property. The trial court allowed the application and granted the injunction. That order is impugned in this appeal. spb/- 3 ao672-10.sxw 6 There is no dispute between the parties that the respondent had executed a sale deed in favour of the appellants on 31st of August, 2005 and that the sale deed has been registered in accordance with law and the ownership of the property has been transferred by the sale deed. Counsel for the respondent, however, submitted that there was failure on the part of the appellants to pay consideration inasmuch as part of the consideration has remained unpaid as the cheques of Rs.8,00,000/- being part of the consideration have been dishonoured. Learned counsel for the respondent further submitted that in order to prevent multiplicity of litigation it was necessary to grant injunction, restraining the appellants from creating any third party interest in the property and therefore, the trial court has committed no error in granting the injunction. 7 Section 55 of the Transfer of Property Act says that in the absence of a contract to the contrary, the buyer and seller of immovable property respectively are subject to the liabilities and have the rights, mentioned in the rules next following Sub-section 4 of Section 55 reads as under : “(4) The seller is entitled --- (a) to the rents and profits of the property till ownership thereof passes to the buyer; spb/- 4 ao672-10.sxw (b) where the ownership of the property has passed to the buyer before payment of the whole of the purchase money, to a charge upon the property in the hands of the buyer, any transferee without consideration or any transferee with notice of the non-payment, for the amount of the purchase-money, or any part thereof remaining unpaid, and for interest on such amount or part from the date on which possession has been delivered.” We are concerned with clause (b) of sub-section 4 of Section 55, according to which where the ownership of the property has passed to the buyer before payment of the whole of the purchase-money, the seller would have charge upon the property in the hands of the buyer. In the case of Vidhyadhar vs. Mankikrao & Anr., reported in AIR 1999 Supreme Court 1441, while considering the provisions of section 55 of the Transfer of Property Act, the Supreme Court has held that actual payment of whole of the price at the time of the execution of sale deed is not a sine qua non to the completion of the sale. Even if the whole of the price is not paid but the document is executed and thereafter registered, if the property is of the value of more than Rs. 100/- the sale would be complete. Thus on execution and registration of the sale deed, the sale was complete and the only right that the respondent had was of a charge spb/- 5 ao672-10.sxw on suit the property. Since the suit property is already charged, the trial court was not right in granting an injunction restraining the appellants from selling or transferring the property. At the best, in order to prevent the multiplicity of the litigations, the trial court could have imposed a condition on the appellants that in the event of their transferring the suit property, the appellants shall disclose in the deed of transfer and fact of pendency of the suit and also fact that there was statutory charge on the suit property of the non-payment of the part of the purchase price. 8 Mr. Godbole, learned counsel for the appellants submits that on account of dispute in the area of the land, the consideration which has been paid is adequate and that there is no charge on the property. That matter, however, would be decided only at the trial. If the appellants wish to effect transfer of the property, they must disclose the fact of the pendency of the suit and of the statutory charge under section 55 of the Transfer of Property Act. 9 For the aforesaid reasons, the appeal is allowed. The impugned order is set aside and substituted by the following order : 10. In the event, the appellants intend to transfer, convey or alienate the property and /or any part thereof, they shall disclose to the spb/- 6 ao672-10.sxw transferee about pendency of the suit and shall also disclose to the transferee the existence of a charge under section 55 of the Transfer of Property Act. 11 In view of the above order in the Appeal, the civil application no. 861 of 2010 does not survive and the same is disposed of. [D.G. KARNIK, J.]