Second Appeal No.197 of 1982

16th March, 1994

Petitioner Counsel: N. B. Shah, s
Respondent Counsel: A. S. Rao, for R. M. Agrawal, .

Cases Cited:
AIR 1993 Ker 242 (Referred) [Para 6]
AIR 1982 SC 989 [Para 5]

JUDGMENT

JUGMENT :-In what situations will be doctrine of "part performance" as enunciated in Section 53A of the Transfer of Property Act, 1882 serve as a valid defence? It is incumbent on the party invoking the provisions of Section 53A of the Transfer of Property Act to establish before the Court that all the requirements of this section, and not only some of them, have been satisfied. Where the document in question is unavailable for good reasons, it would still be necessary to adduce secondary evidence to satisfy, the Court that there existed a contract in writing and, more importantly, so that the Court may ascertain with reasonable certainty as to what were the terms of that document. Equally necessary for the protection under this section to be made available, the defendant will have to be willing to

perform the terms of the contract as required. In the absence of everyone of these requirements being satisfied and where the burden of proof is not adequately discharged, the applicability of Section 53A of the Transfer of Property Act will be impermissible.

2. This Second Appeal, though admitted in the year 1982, pertains to a litigation that commenced by way of Regular Civil Suit No.47 of 1976 filed before the Civil Judge, Junior Division, Sindkheda.

The present appellants, who are the legal heirs of one Laxman Shankar Pathak, were the original plaintiffs to that suit. It was their that the deceased Laxman was the owner of lands admeasuring 5 Acres and 11 Gunthas bearing Gat No.37 of Mauja Ajande Budruk and that in or about the year 1966-67 he is alleged to have executed a "Sauda Pavti" or an agreement to sell in respect of the said lands with defendant No.1. The plaintiffs had contended that Laxman was in need of a sum of Rs. 2,200/ - which was advanced by defendant No.1 and that the agreement was to the effect that the lands were to be utilised by defendant No.1 to whom possession had been handed over for a period of five years. Obviously, the intention of the parties was that within this period of five years, the loan of Rs. 2,200/- would be satisfied and defendant No.1 would accordingly return the lands in question. Nothing happended thereafter until January, 1978 and the lands continued in the possession of defendant No.1, at which point of time a notice was served on him dated 19-1-1978 pointing out that the period of five years had elapsed and that the possession of the lands should be restored to the plaintiffs. A reply dated 13-2-1978 was sent to this notice wherein the contention was taken up that the defendants are entitled to retain the lands as there was an oral sale for a consideration of Rs. 4,200/- which amount had been paid to Laxman. Pursuant to this correspondence, the plaintiffs filed the suit for possession of the lands and for mesne profits.

3. It is necessary to briefly recount the case made out in the written statement which accepts the position with regard to the existence of the "Sauda Pavti", but the legal contention adopted is to the effect that by virtue of the provisions of Section 53A of the Transfer Of Property Act and the doctrine of "part performance" that the plaintiffs are precluded in law from asking for a decree for restoration of the possession. It is in these circumstances that the suit came up for trial. On behalf of the plaintiffs, Kamalabai gave evidence. Defendant No.1 was supposed to have been absconding and was not traceable and defendant No.2 contended that no decree was liable to be passed in the circumstances set out above. The learned trial Judge, after hearing the parties, upheld the defence that had been pleaded in so far as after discussing the law, he held that the possession of the defendants is protected, even if he fails to prove a completed sale. The suit accordingly came to be dismissed.

4. Against this judgment, the plaintiffs filed Civil Appeal No.162 of 1980 before the District Court at Dhule. The learned appellate Judge upheld the contention that the defendants are entitled to the protection of Section 53A of the Transfer of Property Act and on that count the plaintiffs would not be entitled to enforce any right nor will they be entitled to possession and, consequently, confirmed the order of the trial Court dismissing the plaintiffs' suit. It is against these concurrent findings that the present second appeal has been directed. At the admission of this appeal, the point of law canvassed was essentially to the effect that the ingredients of Section 53A of the Transfer of Property Act have not only been overlooked but that they have been misconstrued and it is basically on this ground alone that the present appeal has been agitated.

5. Shri Shah, learned Counsel appearing in support of the appeal, has drawn my attention to the judgment of the trial Court as also of the appellate judgment. Shri Shah has concentrated his submissions on pointing out that he does not propose to agitate the subsidiary issue, but on the contrary that he has gone straight to the heart of the matter by alleging that the protection available to the defendants under Section 53A of the Transfer of Property Act has been wrongly conferred

on them. In this regard, Shri Shah has analytically dealt with the provisions of Section 53A of the Transfer of Property Act, which reads as follows :-

"53A. Where any person contracts to transfer for consideration any immoveable property by writing signed by him or on his behalf from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty, and the transferee has, in part performance of the contract, taken possession of the property or any part thereof, or the transferee, being already in possession, continues in possession in part performance of the contract and has done an act in furtherance of the contract, and the transferee has performed or is willing to perform his part of the contract, then notwithstanding that the contract, though required to be registered, has not been registered, or, where there is an instrument of transfer, that the transfer has not been completed in the manner prescribed therefor by the law for the time being in force, the transferor of any person claiming under him shall be debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession other than a right expressly provided by the terms of the contract;

Provided that nothing in this section shall effect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof."

He has also relied on the observations of the Supreme Court in the case of Govindrao Mahadik v. Devi Sahai, AIR 1982 SC 989. The Supreme Court has, in this decision, dealt with the doctrine of part-performance and its applicability and has laid down certain conditions precedent for the invocation of this doctrine. The Supreme Court has in that decision observed as follows at page 999 :-

"To qualify for the protection of the doctrine of part-performance it must be shown that there is a contract to transfer for consideration immovable property and the contract is evidenced by a writing signed by the person sought to be bound by it and from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty. There are pro-requisites to invoke the equitable doctrine of part-performance. After establishing the aforementioned circumstances it must be further shown that a transferee had in part-performance of the contract either taken possession of the property or any part thereof or the transferee being already in possession continues in possession in part-performance of the contract and has done some act in furtherance of the contract. There must be a real nexus between the contract and the acts done in pursuance of the contract or in furtherance of the contract and must be unequivocally referable to the contract.

Section 53-A requires that the person claiming the benefit of part performance must always be shown to be ready and willing to perform his part of the contract, and if it is shown that he was not ready and willing to perform his part of the contract he will not qualify for the protection of the doctrine of part-performance."

6. It is material to take cognizance of the fact that Section 53A of the Transfer of Property Act confers certain protection on a party who has entered into possession of immovable property pursuant to an agreement in writing and who has fulfilled certain conditions, even though that party has not acquired a lawful title to the property in question. What is material to note is the fact that by virtue of the provisions of this section, a party who would normally not be entitled to retain the possession of the property is permitted to do so provided that party is ready and willing to perform its obligations. This is a special provision which is not ordinarily available to a contracting party, but as indicated earlier, to qualify for that protection, all the requisite ingredients must be satisfied. In this context, Shri Shah placed reliance on a recent decision, of the Kerala High Court in the case of Damodaran v. Shekharan, AIR 1993 Ker 242. The Court has culled out virtually in a layman's language the five requirements of Section 53A of the Transfer of Property Act, which are extracted below :-

"(1) There should be a contract for the transfer of immovable property.

(2) The contract should be in writing signed by the party sought to be charged therewith and from it the terms should be ascertainable with reasonable certainty.

(3) The transferee should, in part performance of the contract,

(a) take possession, or

(b) continue in possession and do some act in furtherance of the contract.

(4) The transferee should perform, or be willing to perform, his part of the bargain as contained in the writing.

(5) The application of the doctrine should not affect the right of a transferee for consideration without notice of the contract or of the part performance thereof."

7. It is in the light of this principle that Shri Shah has submitted that the plaintiffs had specifically referred to the existence of the "Sauda Pavti" which, in other words, is a contract in writing and which contained certain conditions. Shri Shah contended that the plaintiffs' evidence is clearly to the effect that even if the Court were to construe the transaction as an agreement to sell that the intention of the parties was that in exchange for the amount by defendant No.1, regardless of whether it was Rs. 2,200/- or Rs. 4,200/-, that he was put in possession of the lands for a period of five years and that on the expiry of that period he was obliged to return the lands to the plaintiffs. Shri Shah submitted that the lands were nothing more than a mere security and that the facts of the case would not bring the transaction within the ambit of an agreement to sell. Shri Shah, however, submitted that Section 53 A of the Transfer of Property Act was invoked by the defendants as their solitary defence in so far as since the document in question is admittedly not before the Court and since there is no secondary evidence in the form of copy thereof or definite evidence from either the scribe or a witness to that document or a party who had read that document that we are left with a position whereby the defendants were obliged to substantiate the plea canvassed by them before the Court. Shri Shah pointed out that in law the defendants could never justify the retention of possession because the plea of oral sale is both hollow and worthless in so far as this being an immovable property, in the absence of a registered sale-deed, the defendants cannot claim any right in respect of the lands. He, therefore, submitted that in order to establish before the Court that the possession cannot be taken away from the defendants that it was incumbent upon them to have proved that they come within the four corners of the ingredients of Section 53A of the Transfer of Property Act. Shri Shah submitted that even if the plaintiff's evidence is totally ignored, since the record produced before the Court indicates that the title of the lands has never been transferred to the defendants, that a decree would have to follow almost automatically unless the defendants can validly apply the provisions of Section 53A of the Transfer of Property Act to their case. He pointed out that there is neither primary nor secondary evidence in support of the document in question, even if one were to accept that such a document was, in fact, executed. In this context, I need to emphasise that it is a necessary ingredient of Section 53A of the Transfer of Property Act that the terms of the written contract must be ascertainable with reasonable certainty. The emphasis on the words "reasonable certainty" presupposes that the Court should be in a position to judge the exact nature of the transaction that is the subject-matter of the document. This is the foundational basis for Section 53A of the Transfer of Property Act and in the absence of a document (and in the absence of secondary evidence) from which the Court can ascertain the terms of that document with reasonable certainty, it would be difficult to hold that the defence based solely on the doctrine of part-performance would assist the defendants.

8. As against this position, Shri Rao, learned Counsel appearing on behalf of the respondents, stated that admittedly the two persons who were parties to the execution of the document in 1965-66 are not before the

Court. The plaintiffs have given some vague evidence, but on the question of the document, plaintiff Smt. Kamalabai was hardly able to say anything of certainty. Shri Rao, on the other hand, submitted that even though defendant No.2 does not possess a copy of the document which admittedly was burnt when the house caught fire and even though he does not dispute about the specific terms of that document that he has recounted before the Court that defendant No.1, who was his father, had paid the full consideration for the lands in question. Shri Rao relied heavily on certain other circumstances, the first of them being that if the lands had only been handed over as a security for the loan for a period of five years that surprisingly enough for as long as 12 years, no notice asking for restoration of possession was issued by the plaintiffs. He submitted that this supports the theory that the intention of the parties was to sell the lands to defendant No.1. Secondly, Shri Rao relied heavily on the "Khata Pustika", which indicates that in the year 1965 itself the defendant No.1 had informed the revenue authorities that he had purchased the lands and was in possession thereof. In addition to this, Shri Rao placed strong reliance on the document Exhibit 43, which is executed in the year 1968 by defendant No.1 and one Baliram whereby the same land was mortgaged to Baliram by defendant No.1 and there is a clear recital that defendant No.1 had purchased the land from the plaintiffs. Frankly, I do not see how a document between defendant No.1 and some third party can bind the present plaintiffs. Shri Rao went on to submit that in the present case, the doctrine of part-performance would apply squarely to the defendants in so far as they have taken possession of the lands under a written agreement. Admittedly, there was consideration regardless of whether it was Rs. 2,200/-or Rs. 4,200/- and, consequently, the plaintiffs would be precluded from asking for a decree.

9. As indicated earlier. Section 53A of the Transfer of Property Act will apply only in such cases where all the ingredients are satisfied and not merely where some of them are satisfied. In the present case, it is only by reference, and that too indirect, that we are able to conclude that there was a written agreement between the parties. There is virtually no primary or secondary evidence worth the name in this regard. There is reference to the payment of consideration, but, again, the quantum is in dispute. The terms of the document of the contract are not ascertainable even indirectly, leave alone with reasonable certainty. It is true that the transferee has, in part-performance of the contract, taken possession of the lands, continued in possession and has done some acts in furtherance of the contract. The most important ingredient of Section 53A of the Transfer of Property Act whereunder the transferee is given special protection is co-extenso with the transferee's obligation to perform the terms of the contract. In the present case, it is impossible to ascertain what the terms of the contract were, but in any case if one were to assume that some consideration was paid at the time of the execution of the "Sauda Pavti", it is equally reasonable to hold that the transferee would have been liable to pay the balance consideration on the execution of the sale-deed. This is not the plea taken up by the defence because in the written statement and in the reply to the notice, the contention taken up is that the sale in complete and that the defendants were under no obligation to make any further payment. On a clear construction of the requirements of Section 53A of the Transfer of Property Act, therefore, to my mind, the defendants have failed to demonstrate that they are entitled to the benefit of the doctrine of part-performance. To this extent, the findings of the lower Court are erroneous in law. Under these circumstances, the appeal is liable to succeed and the judgment of the lower Court will necessarily have to be set aside.

10. The appeal accordingly succeeds and is allowed. The judgment of the trial Court as confirmed by the Appeal Court is set aside. The suit is decreed. It is directed that the defendants shall hand over possession of the lands in question to the plaintiffs. It is further directed that the plaintiffs shall refund to the defendants to sum of Rs. 4,200/-. Undoubtedly, even though there is no counterclaim,

the defendants would be entitled to the refund of this amount provided they pay the requisite Court-fees thereon. The office shall draw up the decree accordingly. In the circumstances of the case, there shall be no order as to costs. Certified copy expedited.

Order Accordingly