Abstract
This article aims to undergo a deep study of a recent case of Ghanshyam v. Yogendra Rathi. This article will start with providing a brief of facts to provide the context to the judgment of the case and further conclusions made by the author. The article will also explain the relevant sections that have been relied upon in the case. The article is focussed on understanding the law relating to property transfers. It will help the reader to have a better idea on the topic of the property law and the law relating to it. This article will help the reader understand the court’s instance on the subject.
Introduction
The case of Ghanshyam v. Yogendra Rathi (2023) is a very recent judgment given by Supreme Court. The case arose from the judgment and order of Delhi High Court. the Supreme Court affirmed the decision of the High Court. The case concerns section 53A of the Transfer of Property Act, 1882 that deals with the right of the transferee in case of part performance of the contract. Sections 49 and 17 of the Registration Act, 1908 are also of importance in the case at hand. The bench constituted of Justice Dipankar Dutta and Justice Pankaj Mithal. The judgment was pronounced by Justice Pankaj Mithal. It is to be noted that at this time, appellant is Ghanshyam and Respondent is Yogendra
Facts of the case
Facts of this case are simple and concise. The respondent – plaintiff (Yogendra Rathi) had filed a suit for eviction of the appellant – defendant (Ghanshyam) from his ground floor and one room on the first floor which he had allowed him to reside as a licensee after a sale agreement had been put forward in the favour of the appellant. The appellant established that these documents were not obtained by misrepresentation or manipulation and they were all genuine. Although it was also established by the defendant that there was a will in favour of the defendant but the court had declared that the will was not in force till date.
Issues
The district court had formed three issues, first relating to manipulation, and fraudulently obtaining the alleged document. The second issue was regarding the right of the respondent – plaintiff to get the appellant – defendant evicted and the third issue was regarding entitlement to mesne profits.
Judgement
The case was brought to Supreme Court after the district court and High Court of Delhi had dismissed the claim of the appellant – defendant. As discussed earlier, a bench of two justices was setup for giving the judgment. The Supreme Court again dismissed the claim of the appellant – defendant. The Court explained that the respondent – plaintiff was given the sale agreement to have the possessory right of the property. The court acknowledged that the documents as mentioned by the respondent – plaintiff, the power of attorney, the will, the agreement to sell coupled with possession memo although not complete to establish absolute title but payment of entire sale consideration and the receipt of its payment were able to establish a right of the respondent – plaintiff to claim eviction and the licensee right of the appellant had expired. Thus, the appellant – defendant was liable to evict the said property. On the issue of the manipulation and fraudulently obtaining the documents the court ruled that the documents were genuine. It established that the respondent – plaintiff was in lawful possession of the suit property at least in the part performance and it is indisputable.
The court relied on the judgments in the cases of Veer Bala Gulati v. MCD (2003) and Asha M. Jain v. Canara Bank (2001) where it was held that agreement to sell and payment of full consideration and possession along with irrevocable power of attorney and other ancillary documents constitute transaction to sell even if no sale deed was formed.
The third issue was also held against the appellant – defendant when the court ordered that because the plaintiff – respondent was rightful of the possession so he was also entitled for the mesne profits. This was justified by the fact that the court did not find any tampering in the documents. And due to this the right of the respondent – plaintiff on the suit property was also justified.
Analysis
The relevant statute in this case was the Transfer of Property Act, 1882. Section 53A and 54 of the Act are of most relevance. Section 53A deals with right of the transferee when part performance has been done. It states that if a person has taken the possession of an immovable property on the basis of a contract of sale, he cannot be evicted because the sale was unregistered and the legal title has not been transferred to him. In the present case, the respondent – plaintiff cannot be hindered in his right of possession even if title to possession was not transferred to him. The appellant – defendant was liable after his right as a licensee expired. It has been understood that there are few essentials for invoking this section:
- Contract to transfer immovable property for consideration
- Contract in writing and ascertainable with reasonable certainty
- Part performance of contract by transferee
- Readiness or willingness of transferee
In this case, all the essentials were fulfilled and thus relying on this section was important. The court also referred the section 54 of the act while establishing the right of possession of the respondent – plaintiff. The section tells that an agreement to sell is neither a document of title nor a deed of transfer of property by sale. Thus, it does not confer title of property to transferee. However, the court said that all the documents that the respondent – plaintiff produced were sufficient to establish a possessory right especially the agreement to sale and full payment of consideration of sale.
The Supreme Court through its judgment explained that an agreement to sale is not a document of title or deed of transfer of property by sale. The fact that the respondent – plaintiff has the possession memo established his possessory right on the suit property. The court further held that this right of the respondent – plaintiff cannot be hindered by the appellant – defendant.
Conclusion
In conclusion, the case of Ghanshyam v. Yogendra Rathi highlights the possessory rights of the transferee when part performance had been done by the transferee and is ready and willing to perform the rest of the part of the contract. This is also highlighted in section 53 of the Transfer of Property Act, 1882. The case revolved around establishing the same, the possessory right of the respondent – plaintiff over the suit property although a deed of sale was not there. The case established that if an agreement to sale is not a document of title or a deed of transfer by sale. But, if the consideration to the sale was given by the transferee and it showed readiness and willingness to perform the rest of the part of contract then he cannot be compelled to evict the property or his possessory right can be protected by the law.
This ruling serves as a crucial precedent, affirming that a transferee who has acted in good faith, provided consideration, and shown a commitment to fulfil the terms of the agreement cannot be unjustly deprived of their possessory rights. It highlights the equitable principles inherent in contract law, emphasizing fairness and preventing unjust enrichment or exploitation.
Overall, Ghanshyam v. Yogendra Rathi reinforces the importance of recognizing and protecting possessory rights in cases of part performance, contributing to the clarity and fairness of property transactions under Indian law.
