Case Number: Civil Appeal Nos. 7527-7528 of 2012
Judges Name: Hon’ble Judges Dipankar Datta and Pankaj Mithal, JJ
Order Date: 02.06.2023
FACTS
The appellant, who was the defendant in the initial eviction case has petitioned the Indian Supreme Court to overturn lower court’s decisions that favoured the respondent, who was the original plaintiff. The dispute arose from the respondent’s claim of legitimate ownership of a property located in H-768, J.J. Colony, Shakarpur, Delhi. This claim was supported by an April 10, 2002, sale agreement, a power of attorney, a memo of possession, a receipt confirming full payment of the sale consideration and a will that the appellant left to the respondent. In accordance with the agreement, the respondent allowed the appellant to temporarily occupy one room on the first floor and the ground floor as a licensee for a three-month period. But the appellant continued to occupy the property longer than permitted during this time, which led the eviction lawsuit to be filed. Even though they were contesting the lawsuit, the appellant only focused on accusations of document manipulation rather than questioning the execution of the aforementioned documents or the payment of selling money in accordance with the agreement. The Supreme Court received an appeal after the trial court, appellate court, and high court decided in favour of the respondent, awarding mesne profits for the time of unlawful occupation and issued an eviction decision against the appellant.
ISSUES
- Whether the respondent’s ownership of the property at H-768, J.J. Colony, Shakarpur, Delhi, is established by the sale agreement, power of attorney, memo of possession, receipt of payment of sale consideration and a will bequeathing the property from the appellant to the respondent.
- Whether the respondent’s claim of ownership is sufficiently supported by the suit premises being turned over to the respondent in accordance with the sale agreement, so justifying the appellant’s eviction.
- Whether respondent’s initial three-month license to occupy the ground floor and one room on the first floor of the property by the appellant and their subsequent failure to vacate the premises during the post-license period, justify the eviction decree against the appellant.
- Whether the appellant’s failure to leave the premises led to the license being terminated on February 18, 2003 and this strengthened the respondent’s cause for eviction and mesne profits claim.
- The validity of the documents and their impact on the ownership and possession of the property in relation to Section 54 of the Transfer of Property Act, 1882, and other pertinent legal frameworks.
PETITIONER’S ARGUMENT
- In spite of being served, the plaintiff-respondent did not show up in court as represented by Shri Rajul Shrivastav, the defendant-appellant.
- In his lawsuit challenge, the defendant-appellant claimed that documents had been altered on blank sheets of paper, but he did not dispute their execution, the execution of the possession memo, or the payment of the agreed-upon selling value.
- The trial court resolved all questions against the defendant-appellant by framing three problems pertaining to the manipulation and fraudulent acquisition of documents, the plaintiff-respondent’s authority to remove the defendant-appellant, and the claim to mesne profits. Particularly, it was determined that the plaintiff-respondent, who also demonstrated his legitimate ownership of the land had not used any deception, coercion, or fraud to obtain the documents. Thus, after determining the defendant-appellant’s license, eviction and payment of mesne profits were warranted, albeit not at the rate claimed by the plaintiff.
- Since there was no execution of a sale deed or other action that could have granted the plaintiff-respondent title, the defendant-appellant’s power of attorney granted to the plaintiff-respondent was ruled insignificant for the purpose of transferring title. The general power of attorney was ineffectual because the holder did not execute any consequential documents.
RESPONDENT’S ARGUMENT
- The plaintiff-respondent is claiming ownership of the property based on certain documents and the legal issue revolves around an eviction and mesne profits claim.
- A memo of possession, a sale agreement, and a receipt verifying the payment of the sale amount are among these documents.
- These records are important to the plaintiff’s ownership claim and the ensuing eviction and mesne profits lawsuit proving their importance in the case.
EXAMINING THE LAW
- An agreement to sell does not transfer ownership of immovable property even while it is not legally equal to a sale deed.
- The possessory title is granted to a prospective buyer who has complied with the terms of the contract and is in legal possession.
- Section 53A of the Transfer of Property Act, 1882 protects this possessory title which prevents the seller or anybody claiming through the seller from violating the buyer’s rights.
PRECEDENT ANALYSIS
The court reviewed the legality and consequences of a number of property transfer documents in this analysis such as a general power of attorney, a will dated 10.04.2002, including customs related to agreements to sell with possession. The court made it clear that a will cannot grant any rights prior to the maker’s death because it has no legal force until then. It also reiterated that it is against the law to accept general powers of attorney and other like instruments as granting title or rights to real estate particularly in transactions involving more than Rs. 100. The Transfer of Property Act, 1882, specifically Section 54, which requires the execution and registration of a document of title or transfer to confer rights and title in immovable property was cited by the court. Along with pointing out inconsistencies with several Delhi High Court decisions, the court reiterated that wills, power of attorney, and agreements to sell do not actually transfer ownership of immovable property until a legal conveyance deed is executed and recorded. The necessity of following legislative requirements for property transfers is made clear by this position which is consistent with the Supreme Court’s rejection of transferring immovable property rights through sale agreements, general powers of attorney and wills without a registered conveyance deed.
JUDGEMENT
In connection with a real estate sale, the court heard a disagreement over possessory rights and eviction. Several important facts and conclusions were addressed in the judgment:
- For the use and occupation of the disputed premises, the plaintiff-respondent was granted mesne profits at a monthly rate of Rs. 1000/-.
- An agreement to sell created the plaintiff-respondent’s possessory rights over the suit property in part performance of the agreement, the court noted, even though it does not function as a title document or a deed transferring property. A possession letter attested to the plaintiff-respondent’s lawful possession and the agreement’s statement of full payment of the selling consideration, substantiated by a receipt further confirmed this.
- Since the defendant-appellant entered the property later only as the plaintiff-respondent’s licensee and not as the property’s owner, his occupation could not interfere with the plaintiff-respondent’s claimed possession.
- The defendant-appellant was unable to contest the plaintiff-respondent’s established possession of the property as part of the agreement as the court discovered no evidence of fraud or manipulation in the execution of the pertinent documents.
- The basis of the lawsuit which sought to evict the defendant-appellant from the property and recover mesne profits was that the defendant-appellant was only a licensee whose license had expired and had no right to disturb the plaintiff-respondent’s possession after giving it to them as part of the agreement.
- Ultimately, the court determined that the defendant-appellant had lost ownership and merely had a licensee’s right since the plaintiff-respondent had obtained a possessory title through partial performance of the agreement to sell.
CONCLUSION
Based on the established facts and circumstances of the case, the Supreme Court determined that the plaintiff-respondent was entitled to a decree of eviction and mesne profits. Based on the defendant-appellant’s partial performance of a sale agreement, the court found that the plaintiff-respondent had obtained possessory rights over the property which they could not legally revoke. Because the plaintiff-respondent’s claim for eviction and mesne profits had been legally terminated, the defendant-appellant’s subsequent occupancy of the property was exclusively as a licensee. The plaintiff-respondent decree was found to be valid and error-free by the Supreme Court which resulted in the dismissal of the appeals without a cost order. This decision upholds the rule of law that possessory rights created by partial fulfillment of a sale agreement are safeguarded and may serve as the foundation for eviction and profit recovery where the party in possession is displaced without a valid reason.
Author – Disha Sable
1st year Law student at RTMNU’s Babasaheb Ambedkar College of Law, Nagpur
REFERENCES
1.
2. https://thelawtree.akmllp.com/apex-rulings/ghanshyam-vs-respondent-yogendra-rathi/
3. https://indiankanoon.org/doc/65582027/
4.https://www.lawinsider.in/judgment/landmark-judgement-ghanshyam-v-yogendra-rathi-2023
