Recently, the Supreme Court addressed a property dispute between two brothers concerning a house in Delhi. The dispute centred on whether ownership could be claimed through documents such as an Agreement to Sell, a General Power of Attorney, an Affidavit, a receipt of payment, and a registered Will, without a registered sale deed. The Court also examined how a Will can be proved under the Succession Act and the Evidence Act, the legal effect of GPA transactions, and the applicability of Section 53A of the Transfer of Property Act, which recognizes the doctrine of part performance.
Brief Facts:
The property in dispute originally belonged to late Shri Kundan Lal, the father of both the plaintiff and the defendant No.1. The plaintiff claimed that his father had transferred ownership in his favour through an Agreement to Sell, GPA, Affidavit and Receipt and additionally executed a registered Will on the same day. He alleged that the appellant was only a licensee who later turned into a trespasser and even sold half of the property to a third party, defendant No.2. In response, the appellant denied these claims and contended that the property had been orally transferred to him as far back as 1973 by his father, after which he remained in uninterrupted possession. He further alleged that the plaintiff’s documents were fabricated and obtained through misrepresentation. The Trial Court decreed the suit in favour of the plaintiff while rejecting the counter-claim of the appellant. On appeal, the Delhi High Court affirmed the Trial Court’s decision. Aggrieved, the appellant approached the Supreme Court.
Contentions of the Appellant:
The counsel for the appellant argued that ownership rights could not be transferred merely on the strength of an Agreement to Sell, GPA, Affidavit, or Receipt, without a duly registered sale deed as required under Section 54 of the Transfer of Property Act. It was further submitted that the Will relied upon by the plaintiff had not been proved in accordance with Section 63 of the Succession Act and Section 68 of the Evidence Act. The appellant also emphasized that the original title deeds of the property were in his possession, and that he had enjoyed uninterrupted occupation since 1973 without any objection from his father. It was further pointed out that in an earlier suit filed in 1996, the plaintiff himself admitted that the father was the owner, which belied his subsequent claim that he had purchased the property in 1996.
Contentions of the Respondents:
Respondent No.1, though served, did not appear before the Apex Court and was proceeded ex parte. His case before the lower courts was that the combination of documents executed by the father along with the registered Will of 1996 vested full ownership in him, making the appellant a mere trespasser.
Respondent No.2, who purchased half of the suit property from the appellant, contended through counsel that he was a bona fide purchaser for consideration. He urged that his rights had already been protected both by the High Court in 2011 and by an interim order of the Supreme Court in 2013, and therefore the final judgment must also safeguard his possession and ownership rights to the extent of the appellant’s share.
Observations of the Court:
The Court carefully examined the documents relied upon by the plaintiff. With respect to the Agreement to Sell, the Court reiterated that under Section 54 of the Transfer of Property Act, an agreement of sale does not create any interest or charge in immovable property and that ownership passes only through a registered sale deed. It observed “An agreement of sale, whether with possession or without possession, is not a conveyance. An agreement of sale, whether with possession or without possession, does not of itself create any interest in or charge on such property. Section 54 of the Transfer of Property Act, 1882 makes it clear that a contract for sale of immovable property does not, of itself, create any interest in or charge on such property.”
On the question of the GPA, the Court held that it merely creates an agency relationship and cannot by itself operate as a conveyance of title. The Court cited earlier precedents including Suraj Lamp and Industries Private Limited (2) through Director v. State of Haryana and Another case to reaffirm that a GPA does not transfer ownership.
The Court then turned to the registered Will. It emphasized that under Section 63 of the Succession Act and Section 68 of the Evidence Act, a Will must be proved by examining at least one attesting witness. The Court categorically noted “Mere fact that the Will was registered will not grant validity to the document.” It also observed that suspicious circumstances surrounded the Will, since the father had four children but the Will conferred the entire property upon only one child without any explanation for disinheriting the others. Such circumstances, according to the Court, had not been dispelled by the plaintiff.
As for the Receipt and Affidavit, the Court held that they could not substitute a registered deed of conveyance, and therefore did not confer valid title. Regarding the claim under Section 53A of the Transfer of Property Act, the Court rejected it outright since the plaintiff himself had sought possession through the suit, which indicated that he was never in possession. The Court noted “The very fact that plaintiff has filed the present suit for possession, along with other reliefs, shows that on the date of filing of the suit, plaintiff was not in possession”
The decision of the Court:
The Court allowed the appeal, set aside the judgments of both the Trial Court and the High Court, and dismissed the plaintiff’s suit. However, it protected the rights of Respondent No.2, holding that his interest would be safeguarded to the extent of the appellant’s share in the property. The Court made no order as to costs and left the parties free to work out their rights in accordance with law.
Case Title: Ramesh Chand (D) Thr. LRs v. Suresh Chand and Anr.
Case No.: Civil Appeal No. 6377 of 2012
Citation: 2025 Latest Caselaw 846 SC
Coram: Justice Aravind Kumar, Justice Sandeep Mehta
Counsel for Appellant(s): Adv. S. Mahendran,
Counsel for Respondent(s): Adv. Rekha Pandey
Read Judgment @LatestLaws.com
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