Telangana High Court

P. Venkateshwar Rao Since Deceased vs K.L.V. S. Lakshmi on 5 June, 2024

             THE HON'BLE SMT JUSTICE K. SUJANA


          CIVIL REVISION PETITION NO.1657 OF 2023

ORDER :

This revision petition is filed by the revision

petitioners/respondents 3, 4, 6 and 7 aggrieved by the order dated

15.03.2023 passed in I.A.No.2183 of 2018 in O.S.No.278 of 2013

by the II Additional Chief Judge, City Civil Court, Hyderabad.

2. I.A.No.2183 of 2018 is filed by the petitioner/proposed

defendant No.8, under Order I Rule 10(2) of Code of Civil

Procedure (for short 'CPC') praying to implead her as defendant

No.8 in O.S.No.278 of 2013 which is filed for partition of suit

schedule properties. The contention of petitioner in the said

petition is that defendants 5 and 6 are sons of defendant No.3 and

along with them, their mother acquired the suit schedule property

by way of registered partition deed bearing document No.3040 of

2012 dated 14.09.2012 and they have entered into an agreement

of sale on 10.12.2016 with the petitioner/proposed defendant.

The contention of the petitioner/proposed defendant is that the

defendants 5 and 6 along with their mother have taken almost

total sale consideration for the purpose of performing the marriage

of sister of defendants 5 and 6 namely P.Pallavi and thereafter

possession was also delivered to her after receiving full

consideration and she in possession and enjoyment of the

property. But the respondents therein in collusion with other

defendants filed the present suit for partition. As such, she is a

necessary party to the said suit.

3. The respondents therein filed counter stating that there is

no truth in the allegation leveled in the petition and they have

denied execution of agreement of sale in favour of the

petitioner/proposed defendant, receiving part sale consideration

and delivery of possession.

4. Having considered the averments of the petition and

counter, the trial Court allowed I.A.No.2183 of 2018 observing that

the third party is having interest in the suit schedule property. As

such, she is proper and necessary party to the suit in O.S.No.278

of 2013.

5. Against the said order, the present revision is filed stating

that in a suit for partition, the third party who is not belonging to

the family is not a necessary party. If at all, the petitioner therein

is having any interest, she has to file suit for specific performance

and there is also an averment in her petition that she has already

filed a suit for specific performance against the plaintiffs and the

same is pending. As there is an agreement of sale, even without

admitting the same as genuine, the only remedy available to her is

to file suit for specific performance and trial Court erred in holding

that proposed defendant No.8 has established her interest over the

suit schedule property and she is claiming rights basing on

agreement of sale which is not a concluded contract and no

registered sale deed is existing in her name to claim right.

Therefore, the trial Court erred in allowing the petition under

Order 1 Rule 10 (2) of CPC. As such, prayed the Court to set aside

the impugned order.

6. Heard Smt Manjari S. Ganu, learned counsel for the revision

petitioners, Sri Deepak Misra, learned counsel appearing for

respondent No.1, Sri V.V.Ramana, learned counsel appearing for

respondent Nos.2 and 3 and Sri Sharad Sanghi, learned counsel

appearing for respondent No.4.

7. The contention of the learned counsel for the petitioners

herein is that the party who filed petition under Order I Rule 10 of

CPC is not their family member. According to the proposed

defendant, she entered into agreement of sale during pendency of

the suit and agreement of sale cannot confer any rights on the

parties. Therefore, she is not a necessary or proper party to the

suit. As such, prayed the Court to allow this revision by setting

aside the order of the trial Court.

8. The contention of learned counsel for the respondent/3rd

party is that as the respondent is having interest in the suit

schedule property, she has also filed suit for specific performance.

If this suit is decided without adding her as a party, her rights will

be effected. Therefore contended that there is no illegality in the

order of the trial Court and prayed the Court to dismiss this

revision.

9. As seen from the record and having regard to the rival

submissions, it is noticed that petitioner who is third party to the

suit filed petition under Order I Rule10 (2) of CPC to implead her

as a party to the partition suit as the defendants 5 and 6 and their

mother executed an agreement of sale in her favour, total

consideration was paid, possession was delivered to her and that

she is in possession of the property. Therefore, if the partition suit

is decided without adding her as a party to the said suit, her rights

will be affected. The partition suit is mainly between the family

members and a person who is not a member of the family is not a

proper or necessary party to the partition suit, it is a general rule,

whereas, if any property is purchased by the third party during

pendency of the suit, to avoid multiplicity of proceedings, the said

person can be added as party to the suit whereas, the contention

of the petitioners is that in the present case, no rights are accrued

to the respondent/3rd party as the document relied on by her is an

agreement of sale and it not a sale under Section 54 of the

Transfer of Property Act.

10. In Suraj Lamp and Industries Private Limited Vs State of

Haryana and another 1, the Hon'ble Supreme Court observed as

under :

"16. Section 54 of the TP Act makes it clear that a contract of sale, that is, an agreement of sale does not, of itself, create any interest in or charge on such property. This Court in Narandas Karsondas v. S.A. Kamtam [(1977) 3 SCC 247] observed: (SCC pp. 254-55, paras 32-33 & 37)

"32. A contract of sale does not of itself create any interest in, or charge on, the property. This is expressly declared in Section 54 of the Transfer of Property Act. (See Ram Baran Prasad v. Ram Mohit Hazra [AIR 1967 SC 744 : (1967) 1 SCR 293] .) The fiduciary character of the personal obligation created by a contract for sale is recognised in Section 3 of the Specific Relief Act, 1963, and in Section 91 of the Trusts Act. The personal obligation created by a contract of sale is described in Section 40 of the Transfer of Property Act as an obligation arising out of contract and annexed to the ownership of property, but not amounting to an interest or easement therein.

33. In India, the word 'transfer' is defined with reference to the word 'convey'. ... The word 'conveys' in Section 5 of the Transfer of Property Act is used in the wider sense of conveying ownership.

1 (2012) 1 Supreme Court Cases 656

***

37. ... that only on execution of conveyance, ownership passes from one party to another...."

18. It is thus clear that a transfer of immovable property by way of sale can only be by a deed of conveyance (sale deed). In the absence of a deed of conveyance (duly stamped and registered as required by law), no right, title or interest in an immovable property can be transferred.

19. Any contract of sale (agreement to sell) which is not a registered deed of conveyance (deed of sale) would fall short of the requirements of Sections 54 and 55 of the TP Act and will not confer any title nor transfer any interest in an immovable property (except to the limited right granted under Section 53-A of the TP Act). According to the TP Act, an agreement of sale, whether with possession or without possession, is not a conveyance. Section 54 of the TP Act enacts that sale of immovable property can be made only by a registered instrument and an agreement of sale does not create any interest or charge on its subject-matter."

11. When there is no interest accrued to the 3rd party, she

cannot file the petition to implead her as proper party in a suit

filed for partition by one of the plaintiff. In N. Narasimha Reddy,

Vs Brahmathantra Parakalamut and others 2, the High Court of

Andhra Pradesh in para 9 observed as under :

"9. Once it had emerged that the petitioner did not plead any right of his own in the subject-matter of the suit when it was filed, nor did he plead that he acquired any right subsequent to the filing of the suit in any of the items of the property, it is impermissible for him to come on record as a party to the suit."

2 2006 (3) ALD 153

12. In Rajbala Ghiloria Vs Ashok Kumar Sethi and another 3 it

was held as under :

19. Accordingly, given the fact that the Agreement to Sell was entered into by the Petitioner herein on 21st March 2018, post the judgment in Suraj Lamp (supra), wherein the Supreme Court clearly held that an unregistered Agreement to Sell cannot be the basis of claiming ownership, the said Agreement to Sell cannot, in law, be a ground or the basis for the impleadment of the Petitioner in a partition suit.

20. A suit for partition has to be adjudicated between the co-

owners of the property. Since the rights of the Petitioner, if any, are yet to be determined in the suit for specific performance which is pending before the Trial Court, the Petitioner cannot claim a right to be impleaded, in the suit for partition. Thus, the Trial Court is not at fault, in holding that the suit for partition would have to be adjudicated only between the co-owners.

13. In Thomson Press (India) Limited Vs Nanak Builders and

Investors Private Limited and Others 4, relied on by the learned

counsel for the respondents, the Apex Court observed as under :

"53. There is, therefore, little room for any doubt that the transfer of the suit property pendente lite is not void ab initio and that the purchaser of any such property takes the bargain subject to the rights of the plaintiff in the pending suit. Although the above decisions do not deal with a fact situation where the sale deed is executed in breach of an injunction issued by a competent court, we do not see any reason why the breach of any such injunction should render the transfer whether by way of an absolute sale or otherwise ineffective. The party committing the breach may doubtless incur the liability to be punished for the breach committed by it but the sale by itself may remain valid as between the parties to the transaction subject only to any directions which the competent court may issue in the suit against the vendor.

3 2021 SCC online del 4801

4 (2013) 5 Supreme Court Cases 397

54. The third dimension which arises for consideration is about the right of a transferee pendente lite to seek addition as a party- defendant to the suit under Order 1 Rule 10 CPC. I have no hesitation in concurring with the view that no one other than the parties to an agreement to sell is a necessary and proper party to a suit. The decisions of this Court have elaborated that aspect sufficiently making any further elucidation unnecessary. The High Court has understood and applied the legal propositions correctly while dismissing the application of the appellant under Order 1 Rule 10 CPC. What must all the same be addressed is whether the prayer made by the appellant could be allowed under Order 22 Rule 10 CPC, which is as under:

"10. Procedure in case of assignment before final order in suit.--(1) In other cases of an assignment, creation or devolution of any interest during the pendency of a suit, the suit may, by leave of the court, be continued by or against the person to or upon whom such interest has come or devolved.

(2) The attachment of a decree pending an appeal therefrom shall be deemed to be an interest entitling the person who procured such attachment to the benefit of sub-rule (1)."

A simple reading of the above provision would show that in cases of assignment, creation or devolution of any interest during the pendency of a suit, the suit may, by leave of the court, be continued by or against the person to or upon whom such interest has come or devolved. What has troubled us is whether independent of Order 1 Rule 10 CPC the prayer for addition made by the appellant could be considered in the light of the above provisions and, if so, whether the appellant could be added as a party-defendant to the suit. Our answer is in the affirmative. It is true that the application which the appellant made was only under Order 1 Rule 10 CPC but the enabling provision of Order 22 Rule 10 CPC could always be invoked if the fact situation so demanded. It was in any case not urged by the counsel for the respondents that Order 22 Rule 10 could not be called in aid with a view to justifying addition of the appellant as a party- defendant. Such being the position all that is required to be examined is whether a transferee pendente lite could in a suit for specific performance be added as a party-defendant and, if so, on what terms.

55. We are not on virgin ground insofar as that question is concerned. Decisions of this Court have dealt with similar situations and held that a transferee pendente lite can be added as a party to the suit lest the transferee suffered prejudice on account of the transferor losing interest in the litigation post transfer. In Khemchand Shankar Choudhari v. Vishnu Hari Patil [(1983) 1 SCC 18] this Court held that : (SCC p. 21, para 6)

"6. ... The position of a person on whom any interest has devolved on account of a transfer during the pendency of a suit or a proceeding is somewhat similar to the position of an heir or

a legatee of a party who dies during the pendency of a suit or a proceeding...."

Any such heir, legatee or transferee cannot be turned away when she applies for being added as a party to the suit. The following passage in this regard is apposite : (SCC pp. 20-21, para 6)

"6. Section 52 of the Transfer of Property Act no doubt lays down that a transferee pendente lite of an interest in an immovable property which is the subject-matter of a suit from any of the parties to the suit will be bound insofar as that interest is concerned by the proceedings in the suit. Such a transferee is a representative in interest of the party from whom he has acquired that interest. Rule 10 of Order 22 of the Code of Civil Procedure clearly recognises the right of a transferee to be impleaded as a party to the proceedings and to be heard before any order is made. It may be that if he does not apply to be impleaded, he may suffer by default on account of any order passed in the proceedings. But if he applies to be impleaded as a party and to be heard, he has got to be so impleaded and heard. He can also prefer an appeal against an order made in the said proceedings but with the leave of the appellate court where he is not already brought on record. The position of a person on whom any interest has devolved on account of a transfer during the pendency of any suit or a proceeding is somewhat similar to the position of an heir or a legatee of a party who dies during the pendency of a suit or a proceeding, or an Official Receiver who takes over the assets of such a party on his insolvency. An heir or a legatee or an Official Receiver or a transferee can participate in the execution proceedings even though their names may not have been shown in the decree, preliminary or final. If they apply to the court to be impleaded as parties they cannot be turned out."

56. To the same effect is the decision of this Court in Amit Kumar Shaw v. Farida Khatoon [(2005) 11 SCC 403] wherein this Court held that a transferor pendente lite may not even defend the title properly as he has no interest in the same or may collude with the plaintiff in which case the interest of the purchaser pendente lite will be ignored. To avoid such situations the transferee pendente lite can be added as a party-defendant to the case provided his interest is substantial and not just peripheral. This is particularly so where the transferee pendente lite acquires interest in the entire estate that forms the subject-matter of the dispute. This Court observed : (SCC p. 411, para 16)

"16. The doctrine of lis pendens applies only where the lis is pending before a court. Further pending the suit, the transferee is not entitled as of right to be made a party to the suit, though the court has a discretion to make him a party. But the transferee pendente lite can be added as a proper party if his interest in the subject-matter of the suit is substantial and not just peripheral. A transferee pendente lite to the extent he has

acquired interest from the defendant is vitally interested in the litigation, where the transfer is of the entire interest of the defendant; the latter having no more interest in the property may not properly defend the suit. He may collude with the plaintiff. Hence, though the plaintiff is under no obligation to make a lis pendens transferee a party, under Order 22 Rule 10 an alienee pendente lite may be joined as party. As already noticed, the court has discretion in the matter which must be judicially exercised and an alienee would ordinarily be joined as a party to enable him to protect his interests. The court has held that a transferee pendente lite of an interest in immovable property is a representative-in-interest of the party from whom he has acquired that interest. He is entitled to be impleaded in the suit or other proceedings where his predecessor-in-interest is made a party to the litigation; he is entitled to be heard in the matter on the merits of the case."

(emphasis supplied)

To the same effect is the decision of this Court in Rikhu Dev v. Som Dass [(1976) 1 SCC 103].

14. As seen from the above judgment, the Hon'ble Supreme

Court observed that even if, the transfer is pendente lite the party

can be added in the proceedings as a party-defendant only to

protect his interest.

15. In the present case, the main contention of the revision

petitioners is that as it is only agreement of sale, no right is

accrued to the 1st respondent/proposed party, whereas the

contention of the 1st respondent herein is that she has already

paid total sale consideration and possession was delivered, for

which she has to file a suit for specific performance. She cannot