Himachal Pradesh High Court
Prakash Chand & Another vs Satish Chand & Others on 15 June, 2024
Neutral Citation No. ( 2024:HHC:3524 ) IN THE HIGH COURT OF HIMACHAL PRADESH, SHIMLA CMPMO No. 556 of 2023 Reserved on : 28.05.2024 .
Date of decision: 15.06.2024 Prakash Chand & another ....Petitioners Versus Satish Chand & others ....Respondents Coram Hon'ble Mr Justice Rakesh Kainthla, Judge. Whether approved for reporting? Yes For the Petitioners : Mr. Maan Singh, Advocate.
For the Respondents : Mr. Ajay Kumar, Senior Advocate with Mr. Rohit, Advocate.
Rakesh Kainthla, Judge The present petition is directed against the order dated 19.09.2023, passed by the learned Civil Judge, Kullu, vide which the objections filed by the petitioners and respondents Nos.
3 to 5 (objectors before the learned Trial Court) were dismissed.(Parties shall hereinafter be referred to in the same manner as they were arrayed before the learned Trial Court for convenience).
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1. Whether reporters of the local papers may be allowed to see the judgment? Yes ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 2
2. Briefly stated, the facts giving rise to the present petition are that the plaintiff filed a suit against Parveen Chand, .
the original defendant (respondent No.2 before this Court) and State Bank of Patiala (now merged with State Bank of India) for specific performance of the agreement. The suit was decreed by the learned Trial Court on 22.07.2020 and defendant Parveen Chand was directed to perform his part of the agreement specifically after the receipt of sale consideration. Subsequently, the plaintiff/DH filed a petition under Order 21 Rule 34 of CPC for the execution of the judgment and decree. He asserted that he had deposited ₹3,00,000/- before the learned Court on 28.07.2020.
He found after obtaining Jamabandi that the defendant had transferred the suit land to the predecessor of objectors despite the pendency of the Civil Suit. A mutation was also sanctioned.
Hence, it was prayed that the subsequent seller be directed to join the execution of the Sale Deed and deliver the possession. The Sale Deed and mutation in favour of their predecessor-in-interest be declared null and void.
3. The objectors filed an objection petition taking preliminary objections regarding the petitioner/DH having ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 3 obtained the decree by concealing the facts, the objectors being bona fide purchasers for consideration and the execution petition .
being not maintainable. It was asserted that the objectors were not served in the suit and the ex parte decree was wrongly passed without any notice. They are bona fide purchaser for consideration and a decree cannot be executed against them.
Therefore, it was prayed that the execution petition be dismissed.
4. The plaintiff/DH filed a reply taking preliminary objections regarding objections being barred by limitation, the objectors having notice of the litigation and the objections being hit by the principle of lis pendens. The contents of the objections were denied on merits. It was asserted that the objectors being subsequent purchasers stepped into the shoes of the original vendor and they were bound by the decree in the same manner as the judgment debtor. The objections were filed to defeat the rights of the plaintiff; therefore, it was prayed that the present objection petition be dismissed.
5. The learned Trial Court held that the Sale Deed was executed during the pendency of the suit. The purchasers stepped into the shoes of the original defendant in view of the principle of ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 4 lis pendens and the execution could proceed against the objectors.
Hence, the objections were dismissed and the Court orderedto file .
adraft Sale Deed.
6. Feeling aggrieved and dissatisfied with the order passed by the learned Trial Court, the objectors have presented a petition asserting that the objections raised by the objectors were not dealt with properly. The decree was not executable against the objectors as they were bona fide purchasers for consideration.
They were not impleaded in the suit and are not bound by the decree. They were not aware of the pendency of the suit and are bona fide purchases for consideration. They filed an application for setting aside the ex-pate order, which was dismissed and the appeal is pending against this order. Therefore, it was prayed that the present petition be allowed and the order passed by the learned Trial Court be set aside.
7. I have heard Mr. Maan Singh, learned counsel for the petitioners and Mr. Ajay Kumar, learned Senior Advocate assisted by Mr. Rohit, learned counsel for the respondents.
8. Mr. Maan Singh, learned counsel for the petitioners submitted the learned Trial Court erred in dismissing the ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 5 objection petition. Objectors were not parties to the main suit and the decree could not have been executed against them. Hence, he .
prayed that the present petition be allowed.
9. Mr. Ajay Kumar, learned Senior Advocate supported the order passed by the learned Trial Court and submitted that no interference is required with the same. He submitted that the doctrine of lis pendens applies to the present case and the learned Trial Court had rightly held that the decree was executable against the objectors. Hence, he prayed that the present petition be dismissed. He relied upon the judgment of the Hon'ble Supreme Court in Chander Bhan (D) through LR Sher Singh Vs. Mukhtiar Singh 2024 SCC OnLine SC 761 in support of his submission.
10. I have given considerable thought to the submissions at the bar and have gone through the records carefully.
11. A perusal of the copy of the judgment and decree passed by the learned Trial Court shows that the suit was registered on 23.03.2019 and was decided on 22.07.2020. The predecessor-in-interest of the objector purchased the land vide Sale Deed No. 785 dated 30.4.2019. Hence, the Sale Deed was executed after the registration of the suit.
::: Downloaded on - 15/06/2024 20:29:44 :::CIS 612. It was laid down by Achut Sitaram Patwardhan v.
Shivajirao Krishnarao Gaikwad, AIR 1937 Bom 244 that a party .
purchasing the property during the pendency of the suit will be bound by the ultimate decree, which may be passed by the Court.
It was observed:-
28. It is clear from the terms of this section that the doctrine of lis pendens is not based upon notice, but it rests upon the ground that neither party to a suit can alienate the property in the suit pending the suit so as to defeat the rights of the other party. As the decisions show, it is based upon expediency, and it is immaterial whether the alienee pendente lite had or had not notice of the suit: see, 1 Da G & J 566. [Bellamy v. Sabine, (1857) 1 Da G & J 566: 26 LJ Ch 797: 3 Jur (NS) 943: 6 WR 1.] The mere pendency of a suit will not prevent one of the parties from selling the property, the subject matter of the suit, but the purchase will in no manner affect the right of the other party under any decree which may be made in the suit unless the property was sold with the permission of the Court. The section lays down the principle, which is in conformity with what Story in his "Equity Jurisprudence" observes that the effect of the maxim 'ut lite pendente nihil innovetur" is not to annul the conveyance, but only to render it subservient to the rights of the parties to the litigation. The right then being created by a statute and being restrictive of the ordinary rights of parties, the section, it is dear, must be construed strictly. The point to note is that this statutory right is given to the party to the suit other than an alienating party to have an alienation set aside so far as it is necessary for the protection of his own rights. It has been held that if the plaint is insufficiently stamped and is rejected and is then re-presented after making good the deficiency, alienation between the two dates of presentation would not be subject to lis pendens. In a suit to ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 7 cancel a deed of gift, where the plaint omitted reference to a particular property which the defendant sold before it was included in the suit by an amendment of the plaint, it was held that the sale was not affected by the doctrine of lis .
pendens: see, 50 IC 727, [Ashutosh Boy v. Ananta Ram, AIR 1919 Cal 40: 50 IC 727.] 41 All 534 [Wali Bandi Bibi v. Tabeya Bibi, AIR 1919 All 320: 50 IC 919: 17 ALJ 569:
41 All 534.] and 57 IC 652. [Ramchandra v. Bhagwan, AIR 1920 Nag 92 : 57 IC 652.] I refer to these cases to show how strictly the section is interpreted. Although the learned Judge finds that the sale to the defendant's father is subject to the doctrine of lis pendens by reason of the pendency of suit No. 359, it is fairly conceded before us by Mr. Coyajee that finding cannot be accepted and is not correct. That suit was instituted on 24th September 1912.
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31. Section 52 of the Transfer of Property Act, lays down the conditions which create a lis pendens. One of the conditions is that in a pending suit, a right to immovable property must be directly and specifically in question. Then it provides that the property in regard to which the right is directly and specifically in question in the suit cannot be transferred or otherwise dealt with by any party to the suit so as to affect the rights of any other party thereto under any decree which may be made therein except under authority of the Court and on such terms as it may impose. The roles of procedure require that when any immovable property is in question in a suit, it must be as far as possible specifically described in the plaint, and, if possible, by its boundaries. Mr Thakor, therefore, says that to start with, the two villages are described as being in the Satara District, whereas one of them, namely the village Chandoli, is in Poona District; and, secondly, no boundaries are given, and that even the names of the villages are not accurately written. It is true that a misdescription of the land in the pleadings will prevent the operation of the doctrine of lis pendens; but if in spite of the misdescription, the land is sufficiently identified, then the doctrine will apply. It has ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 8 been held by the Calcutta High Court that an alienee who is aware of the identity of the property will be affected by lis pendens in spite of the misdescription. The question to my mind is not so much the knowledge of the alienee as to the .
identity of the land which he is buying and as to whether it is included in the suit or not, but the question is what was the property which the parties knew and believed was transferred pending the suit by one of the parties thereto. If it is found that the parties to the suit from the; description given in the plaint knew what the properties were, in which a right was specifically and directly asserted, and if, as a result of the decree made therein, either that property or a part of it is allotted to the other party, then it is difficult to see why that party will not be I entitled to rely upon the rule of lis pendens: as against the alienee from his opponent in the suit."
13. It was laid down in Lakshmanan v. Kamal, 1958 SCC OnLine Ker, 1958 SCC OnLine Ker 132that since the transfer of the land during the pendency of the suit is void, there is no necessity to bring the transferee on record and he would be bound by the judgment and decree as if he was a party to the suit. It was observed:-
15. Section 52 of the Transfer of Property Act enacts:
"During the pendency in any Court having authority within the limits of India excluding the State of Jammu and Kashmir or established beyond such limits by the Central Government....of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 9 other party thereto under any decree or order which may be made therein, except under the authority of the Court and on such terms as it may impose. Explanation-- For the purposes of this section, the .
pendency of a suit or proceeding shall be deemed to commence from the date of the presentation of the plaint or the institution of the proceeding in a Court of competent jurisdiction, and to continue until the suit or proceeding has been disposed of by a final decree or order and complete satisfaction or discharge of such decree or order has been obtained, or has become unobtainable by reason of the expiration of any period of limitation prescribed for the execution thereof by any law for the time being in force".
16. The effect of this section is to render void as against the decree-holder in a suit in which any right to immovable property was in dispute and entitle him to ignore all transfers or other dealing with it by the judgment-debtor from the time of the institution of the suit till the complete satisfaction or discharge of the decree which would affect the decree-holder's rights under the decree or any order made in the suit. The explanation specifically enjoins that the prohibition against transfers or dealings is to take effect from the date of the presentation of the plaint or the institution of the proceedings in a court of competent jurisdiction and remain in force until complete satisfaction or discharge of the decree has been obtained or has become unobtainable by reason of the expiration of any period of limitation prescribed by law.
17. If a transfer or other dealing with a suit property pendente lite is void as against the decree-holder and he is entitled to ignore it and it cannot affect his rights under the decree, no purpose will be served by bringing on record, after the transfer, the transferee or the person in whose favour the property has been dealt with; and to insist that a transferee or the person in whose favour the property has been dealt with should be brought on record in such ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 10 cases would only be to hold out a premium to persons who desire to escape from their legal obligations and unnecessarily protract legal proceedings, and would defeat the very purpose for which section 52 of the Transfer of .
Property Act has been enacted.
18. Regarding the necessity and justification for the rule of lis pendens Turner, L.J., has observed in Bellamy v. Sabine, (1857) 1/De C. & J. 566:
"It is as I think, a doctrine common to the Courts both of Law and Equity, and rests, as I apprehend, upon this foundation--that it would plainly be impossible that any action or suit could be brought to a successful termination, if alienations pendente lite were permitted to prevail. The plaintiff would be liable in every case to be defeated by the defendant's alienating before the judgment or decree, and would be driven to commence his proceedings de novo, subject again to be defeated by the same course of proceeding."
19. Lord Cranworth also has said in the same case:
"It is scarcely correct to speak of lis pendens as affecting a purchaser through the doctrine of notice, though undoubtedly the language of the Courts often so describes its operation. It affects him not because it amounts to notice, but because the law does not allow litigant parties to give to others, pending the litigation, rights to the property in dispute, so as to prejudice the opposite party".
(See passages from Their Lordships' judgment extracted at page 224 of Mulla's Transfer of Property Act, 1956 Edition). The explanation to section 52, Transfer of Property Act, is wide enough to include all transfers and dealings with the property made during the pendency of the suit in the trial and appellate courts as well as during the execution proceedings.
20. There is a case reported in I.L.R. 37 Bombay 427, Ishwar Lingo v. Dattu Gopal, almost parallel to the present case. But for the fact that in the Bombay case, the suit was for the ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 11 redemption of four joint mortgages and in the present case, the suit was for the redemption of a kanom, there is practically no difference between the two cases. There, as in the present case, the suit was originally brought against a .
joint family and there was a partition in that family during the pendency of the suit. The co-parcener who obtained the family partitioned the property involved in 37 Bom. 427 died during the course of the suit, and on his death, his right to the property devolved on his widow as his heir. But she was not impleaded in the suit after his death, and after the decree, she came forward and contended that the decree obtained without impleading her was invalid and not binding on her and the properties she got by virtue of the partition and her husband's death. The following passages from the judgment in that case disposing of her contentions are very relevant for the purpose of this case:
".......Thus regarded, it is at once clear that if, indeed, the plaintiff was under any obligation to bring Gopal's widow on the record, that could only have been because of the partition. And as ex hypothesi, that partition, being effected during the active prosecution of a contentious suit, was void against the plaintiff, it could not have cast any such obligation upon him. In using those words we do not lose sight of the learned Judge's view, that although a transfer or dealing with the property in suit pendente lite, it was not dealing which in any way affected the plaintiff's right. We are rather indicating why, in our opinion, that view is incorrect. For anything which imposes a new obligation upon a party to a suit must plainly pro tanto, affect his right........It is surely part of any litigant's right, so far as the subject matter and conduct of the suit are concerned, to know precisely where he stands. He is entitled to know who his opponents are, and, when that has been definitely and finally ascertained, to insist that no dealing on their parts, with the property in suit, shall compel him to go further afield, and bring in new parties, ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 12 who, but for such dealing, could have had no locus standi at all........
Perhaps the simplest and most effective test is to ask whether, if the partition had not been made pendente .
lite, the plaintiff's suit could possibly have ended as it has? The answer to this must be -- No. If there had been no partition, the widow would have had no locus standi, when she intervened in execution. This suit would never have needed to be brought. All his troubles during the last seven years in prosecuting his redemption suit have been brought on the plaintiff by this partition and by nothing else. Or to put it in another way, either the partition has affected the plaintiff's rights as a party, or it has not. If it has, it is admittedly void as against him, under section 52. If it has not, it ought to be ignored, and no considerations drawn from it ought to have any place in the decision of the suit. Taking the latter course what is the result? This, that no Court should have treated the defendant in this suit as having any right whatever against the plaintiff, so far as his suit for redemption went. For it is only on the strength of the partition that she can pretend to any such right, and, ex hypothesi, the partition does not affect the plaintiff for all the purposes of that suit. Thus, the same result is easily and immediately reached either way. It would be easy to add further illustrative considerations. But we think that what we have said warrants us in believing that we have indicated the correct lines of reasoning to be followed in cases of the kind. Applied to the facts of this case, those lines of reasoning yield a very safe conclusion. We have no doubt at all but that the partition of January 10th, 1902, falls within the mischief of section 52, Transfer of Property Act, and cannot be allowed in any way to affect the plaintiff's right, either under his redemption decree or in execution. That being so, and the partition with all its legal consequences out of the ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 13 way, it necessarily follows that the defendant in this suit has no right nor any ground of defence at all".
21. We have quoted the above passage in extenso because it gives an answer to the respondents' contention that section .
52 of the Transfer of Property Act only enjoins that the transfer or dealing with the property shall not affect the decree-holder's rights under the decree and does not obviate the necessity to implead the transferee or the person in whose favour the property has been dealt with after the transfer. The decree-holder's right under the decree is not merely to get the property after paying the mortgage money--that right existed even before the decree and the decree merely enforces that right--but also to get possession of the property from the defendants against whom he had brought a properly constituted suit. The defendants cannot be allowed to defeat that right and cast a burden upon the plaintiff to change the frame of his suit and bring in other persons on record by transfering or dealing with the property pendente lite. It would be extremely difficult, if not altogether impossible, to have a final adjudication if after each successive transfer of the suit property or dealing with it by the defendants the plaintiff has to implead the persons obtaining rights under the transfer or dealing or file a fresh suit against them. He will have then to implead more and more persons in successive and unending stages determined at the sweet will and pleasure of the persons interested in delaying the suit. The effect of the rule of lis pendens, which has been enacted by section 52 of the Transfer of Property Act to get over this difficulty, is that the transferee pendente lite is bound by the proceedings in the suit and the decree therein even though he is not a party to the suit. He takes the transfer subject to the result of the suit to which the original transferor is a party. As pointed out in SeithappaGowndan v. Muthiah Gowndan (I.L.R. 31 Mad.
268):
"The law of lis pendens in this country is founded on the necessity, if possible, of a final adjudication"::: Downloaded on - 15/06/2024 20:29:44 :::CIS 14
22. and to prevent the injustice of the plaintiff being prejudiced by any act of the defendant subsequent to the institution of the suit.
33. For the reasons stated above, we hold that in a suit or .
proceeding in which any right to immovable property is directly and specifically in question (which would include the right to recover property) brought against the manager of a Hindu joint family or the karnavan of a marumakkathayamtarwad in his representative capacity, which is not collusive, the plaintiff, or the decree-holder in the execution proceedings, is not bound to implead either in the suit or in the execution proceedings any person to whom the suit property has been allotted under a partition effected subsequent to the institution of the suit and that all proceedings in such a suit, whether on the trial, appellate, or execution side, would be binding on all the members of the tarwad or joint family including the persons who had obtained title to any part of the suit property under the subsequent partition, if they are valid and binding against the original defendant and the persons whom the plaintiff or decree-holder was bound to implead on the death of such defendant. It will, of course, be open to the persons who have obtained rights to the suit properties by the subsequent partition to apply to get themselves impleaded in the suit or execution proceedings to protect their legitimate rights, if any, and courts have the power to implead them on their applications if their presence in the party array is necessary in the interests of justice. But the plaintiff and the decree-holder are not bound to implead them, and no proceeding can be held to be invalid merely because the plaintiff and the decree-holder have omitted to implead them. We, therefore, hold that the decree-holders were not bound to implead the petitioners in I.A. Nos. 1193, 1194, 1195 and 1196 of 1955 and that the deliveries of the properties complained of in those petitions cannot be set aside on the ground that the decree-holders had failed to implead them.
::: Downloaded on - 15/06/2024 20:29:44 :::CIS 1514. The Hon'ble Supreme Court in Samarendra Nath Sinha v. Krishna Kumar Nag, AIR 1967 SC 1440 that a purchaser pendente .
lite is bound by the result of the litigation. It was observed:
16. What then is the position of the respondent once it is held that the final decree for foreclosure was validly passed by the trial court? Could he challenge that decree in an appeal against it in the High Court on the basis that he was entitled to redeem the said mortgage? Section 91 of the Transfer of Property Act provides that besides the mortgagor any person other than the mortgagee who has any interest in or charge upon the property mortgaged or in or upon the right to redeem the same may redeem or institute a suit for redemption of such mortgaged property.
An execution purchaser therefore of the whole or part of the equity of redemption has the right to redeem the mortgaged property. Such a right is based on the principle that he steps in the shoes of his predecessor-in-title and has therefore the same rights which his predecessor-in- title had before the purchase. Under Section 59-A of the Act also all persons who derive title from the mortgagor are included in the term "mortgagor" and therefore entitled to redeem. But under Section 52 which incorporates the doctrine of lis pendens, during the pendency of a suit in which any right to an immovable property is directly and specifically in question such a property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein except under the authority of the court and on such terms as it may impose. Under the Explanation to that section, the pendency of such a suit commences from the date of its institution and continues until it is disposed of by a final decree or order and complete satisfaction or discharge of such a decree or order has been obtained. The purchaser pendente lite under this doctrine is bound by the result of the litigation on the principle that since the result ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 16 must bind the party to it so must it bind the person deriving his right, title and interest from or through him. This principle is well illustrated in RadhamadhubHoldar v. Monohar [15 IA 97] where the .
facts were almost similar to those in the instant case. It is true that Section 52 strictly speaking does not apply to involuntary alienations such as court sales but it is well- established that the principle of lis pendens applies to such alienations. (See Nilkant v. Suresh Chandra [12 IA 171] and Motilal v. Karrabuldin [24 IA 170] ). It follows that the respondent having purchased from the said Hazra while the appeal by the said Hazra against the said preliminary decree was pending in the High Court, the doctrine of lis pendens must apply to his purchase and as aforesaid he was bound by the result of that suit. In the view we have taken that the final foreclosure decree was competently passed by the trial court, his right to equity of redemption was extinguished by that decree and he had therefore no longer any right to redeem the said mortgage. His appeal against the said final decree was misconceived and the High Court was in error in allowing it and in passing the said order of remand directing the trial court to reopen the question of redemption and to allow the respondent to participate in proceedings to amend the said preliminary decree.
15. Therefore, the plea taken by the plaintiff that sincethey or their predecessor were not parties, therefore, the decree would not have been executed against them was not acceptable.
16. Similarly, it was held in Sukhdeo Prasad v. Jamna, ILR (1901) 23 All 60 at page 65, that the transferee cannot challenge the decree on the ground that they were not parties to the litigation. It was observed:-
::: Downloaded on - 15/06/2024 20:29:44 :::CIS 17It was further contended on behalf of the appellants that as they were not parties to the appeal which ended in a declaration of the plaintiff's right, they are entitled in this suit to have the validity of the plaintiff', title to the property .
re-tried as against them. In my opinion, this is not so. The auction purchaser might have applied to have himself brought on the record as a defendant whilst the case was under appeal (sections 372 and 582 of the Code of Civil Procedure), but he did not choose to do so. To hold that he is entitled, owing to his purchase during the pendency of the appeal, to put the plaintiff again to proof of her title would be entirely opposed to the doctrine of lis pendens which applies to this case.
This may seem to bear somewhat hardly on purchasers at sales in the execution of decrees, but it is only the application of the principle "caveat emptor." Court sells such rights and interests as a judgment-debtor has in the property exposed for sale: it does not guarantee that he has any. If those rights and interests are nil, a purchaser, however complete may be his bonâ fides, acquires nothing. If it turns out that the judgment-debtor had no saleable interest in the property which purported to be sold as his, the purchaser is not entitled to retain the property on the ground that he bought it at a sale held under the orders of the Court. He is only entitled to receive back his purchase money from any person to whom the purchase money has been paid vide section 315 of the Code of Civil Procedure.
In the last ground of appeal, it is urged that Jawahir Lal being a bonâ fide transferee from the auction-purchaser, and having been allowed by the plaintiff to spend a large sum of money on the property in dispute, is entitled to the ??? the fit of section 41 of the Transfer of Property Act, and to have a nit as against him dismissed. I do not think this plea can succeed, as it is difficult to see how it can be held that the auction-purchaser was in possession of the property with the plaintiff's consent.::: Downloaded on - 15/06/2024 20:29:44 :::CIS 18
17. It was contended the transferee's objectors are the bona fide purchasers for consideration, who had no notice .
regarding the pendency of the litigation. It was laid down by this Court in Raj Singh Vs. Maharaj Mai & Ors, 1996(2) Civil Court Cases 326 (HP) that plea of bona fide purchaser for consideration is not available to the transferee, lis pendens. It was observed:-
13. Section 52 is absolutely clear that during the pendency of the suit or proceeding, the immovable property involved in the case directly cannot be transferred. The contention of the learned counsel for the petitioners is that as both the courts below dismissed the suit and the appeal, mere pendency of the second appeal before this Court will not attract the provisions of Section 52 of the Act, which I am unable to accept in view of the explanation to Section 52.
14. Mr Chhabil Dass has placed reliance on two decisions, namely, Simla Banking and Industrial Co. Ltd. v. Firm Luddar Ma! Khushi Ram and others, AIR 1959 Punjab 490, and Kanshi Ram and others v. Kesho Ran Bahna and others, AIR 1961 Punjab 299.
15. In Simla Banking and Industrial Co. Ltd. (supra), the Punjab High Court considered the doctrine of lis pendens elaborately and held that this doctrine is to invest the Court with complete control over alienations in this respect which is pendente lite and thus to render its judgment binding upon the alienates, as if they were parties, notwithstanding the hardship in individual cases.
16. In Kanshi Ram's case (supra). It was held that Section 41 must yield to the doctrine of is pendens under which the title in property could be validly transferred during the pendency of the litigation in respect to it.
18. Hence, the objectors cannot claim to be bona fide ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 19 purchasers for consideration.
19. It was submitted that the decree cannot be enforced .
against the objectors as they are not bound by the decree. This is not acceptable. It was laid down by Allahabad High Court in Ram Peary v. Gauri, AIR 1978 All 318 at page 318 that the specific performance can be enforced even against the transferee and they can be directed to join the transfer for completing the transfer of the title. It was observed:-
2. Section 19(b) of the Act says that Specific performance of a contract may be enforced against (a) either party thereto;
(b) any other person claiming under him by a title arising subsequently to the contract, except a transferee for value who has paid his money in good faith and without notice of the original contract. The Counsel appearing on behalf of the subsequent purchaser has contended that until the suit of the earlier 'contractor' is decreed, the contract to sell and purchase between him and the vendor is nothing but an agreement which does not create any interest in immovable property. The title to the property has validly passed from the vendor and resides in the subsequent transferee; the sale to the latter is not void but only voidable at the option of the "earlier contractor." It would, therefore, be illogical to direct the vendor in a suit brought for specific performance of the contract by the prior contractor, to convey to him, by a decree which is ultimately passed in the suit of the prior contractor, the estate which by then has come to belong to the subsequent transferee and is not his.
3. Reference was made to Durga Prasad v. Deep Chand (AIR 1954 SC 75) where their Lordships laying down the form of the decree which has to be adopted in such a suit observed (at page 81):
::: Downloaded on - 15/06/2024 20:29:44 :::CIS 20"In our opinion, the proper form of the decree is to direct specific performance of the contract between the vendor and the plaintiff and direct the subsequent transferee to join in the conveyance to pass on the .
title which resides in him to the plaintiff. He does not join in any special covenants made between the plaintiff and his vendor; all he does is to pass on his title to the plaintiff." On the other side, it has been maintained that there is no foundation for either proposition; for they seem to be in direct opposition to the established rule as the effect of the lis pendens and that brings us to Section 52 of the Transfer of Property Act which embodies the doctrine known as the doctrine of lis pendens.
4. The principle on which the doctrine rests was spoken by Cranworth L.C. in the leading case of Bellamy v. Sabine ((1857) 44 ER 842 at p. 843) as follows:
"It is scarcely correct to speak of lis pendens as affecting a purchaser through the doctrine of notice, though undoubtedly the language of the Courts often so describes its operation. It affects him not because it amounts to notice, but because the law does not allow litigant parties to give to others, pending the litigation, rights to the property in dispute, so as to prejudice the opposite party.
Where a litigation is pending between a plaintiff and a defendant as to the right to a particular estate, the necessities of mankind required that the decision of the Court in the suit shall be binding, not only on the litigant parties but also on those who derive title under them by alienations made pending the suit, whether such alienees had or had not notice of the pending proceedings. If this were not so, there could be no certainty that the litigation would ever come to an end."
5. The Privy Council had adopted the same principle in Faiyaz Husain Khan v. Munshi Prag Narain ((1907) 34 Ind App 102) where they lay stress on the necessity for final ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 21 adjudication and observation that otherwise there would be no end to litigation and justice would be defeated.
6. Story in his work on Equity IIIrd Edition para 406 expounded the doctrine of lis pendens in the terms as .
follows:--
"Ordinarily, it is true that the judgment of a court binds only the parties and their privies in representations or estate. But he who purchases during the pendency of an action is held bound by the judgment that may be made against the person from whom he derives title. The litigating parties are exempted from taking any notice of the title so acquired, and such purchasers need not be made a party to the action. Where there is a real and fair purchase without any notice, the rule may operate very hard. But it is a rule founded upon a great public policy; for otherwise, alienations made during an action might defeat its whole purpose, and there would be no end to litigation. And hence arises the maxim pendente lite, nihil innovetur; the effect of which is not to annul the conveyance, but only to render it subservient to the rights of the parties in the litigation. As to the rights of these parties, the conveyance is treated as if it never had any existence; and it does not vary them."
(emphasis supplied by us).
7. In the light of these principles we have got to consider whether in the event of a conflict arising between the doctrine of lis pendens enshrined in Section 52 of the Transfer of Property Act and the rule availing a subsequent transferee without notice, contained in Section 19(b) of the Specific Relief Act either the one or the other should prevail. Ordinarily, it is true that the title acquired by the subsequent purchaser is good, the sale to him being not void. But he who purchases during the pendency of the suit is bound by the decree, that may be made against the person from whom he derives title. The litigating parties are exempted from the necessity of taking any notice of a ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 22 title so acquired (see Samarendra Nath Sinha v. Krishna Kumar Nag (AIR 1967 SC 1440)). As to the vendor and the prior contractor, it is as if no such title existed. Section 52 places a complete embargo on the transfer of any right to .
immoveable property pending suit, which is directly and specifically in question in such litigation; it enacts that during the pendency of the suit in which any right to immovable property is "directly and specifically in question, the property cannot be transferred or otherwise alienated by any party to the suit so as to affect the rights of any other party thereto under any decree."
8. Thus, in the present case it may be that the subsequent transferee was entirely ignorant of any right on the part of the contractor, and also of the pendency of the suit filed against the vendor by such contractor, yet as the transfer was made to him by the vendor after the institution of the suit of the contractor and, while it was pending, the subsequent purchaser cannot set up against the contractor any right from which his vendor is excluded by the decree. The title of the subsequent purchaser is good against him on the ground of breach of covenant, but against the plaintiff contractor who seeks specific performance of the contract against the vendor, the subsequent transferee can be in no way better position than the vendor himself. It is well settled that in a suit for specific performance of a contract in respect of immovable property a right to immovable property is directly and specifically in question.
(see Gauri Dutt Maharaj v. Sheikh Sukur Mohammad (75 Ind App 165) : (AIR 1948 PC 147)).
9. As Story has put it in the passage above quoted, the effect of the doctrine of lis pendens is not to annul the conveyance but only to render it subservient to the rights of the parties in the litigation. The conveyance in favour of the subsequent purchaser is treated as if "it never had any existence". The conveyance in favour of the subsequent purchaser thus yields to the adjudication of the rights obtained by the contractor, in the consequence of a decree obtained against the vendor in a suit for specific ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 23 performance of the contract. In Durga Prasad v. Deep Chand (AIR 1954 SC 75) (supra) their Lordships were dealing with the form of the decree in a suit directing specific performance of contract between the vendor and the .
plaintiff and in that connection, with a view to convey to the plaintiff, without cancelling the subsequent sale, they without enforcing the contract against the subsequent purchaser, directed him to join in the conveyance so as to pass on the title which resided in him to the plaintiff. It was not a case falling within the mischief of Section 52 of the Transfer of Property Act.
10. In our opinion, therefore, when the doctrine of lis pendens renders a transfer made during the pendency of the suit subservient to the rights of the plaintiff seeking specific performance of a prior contract entered into by the vendor in his favour and when on account of the operation of the doctrine of lis pendens such conveyance is treated as if it had never any existence, the subsequent transferee, even though he had obtained the transfer without notice of the original contract, cannot set up against plaintiff- contractor any right; for it would defeat the rule of lis pendens which is founded upon public policy. And considered in that manner, Section 52 of the Transfer of Property Act is not subject to Section 19(b) of the Specific Relief Act.
11. We may yet arrive at a similar conclusion in a different manner. "A judgment inter partes raises an estoppel only against the parties to the proceeding in which it is given, and their privies, for example, those claiming or deriving title under them." (Halsbury's Laws of England, Third Edition, Volume 15, para 372). The transferee pendents lite would be treated as a representative in interest of the parties to the suit and the judgment which has been pronounced, in the absence of fraud and collusion, would have the effect of finally determining the rights of the parties and the cause of action which would sustain the suit in which the doctrine of lis pendens applied would be merged in the judgment duly pronounced in what may be ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 24 described as the previously decided suit. The decision being res judicata would bind not only the parties thereto but also the transferees pendente lite from them.
12. In a case to which besides the vendor the subsequent .
transferee is also impleaded in the array of the defendants, the judgment is final and binding not only on the parties to the original contract but also on the transferee pendente lite from the vendor. The conveyance in favour of the subsequent purchaser is treated as if it never had any existence. There would then be no lis or action which would survive, enabling the subsequent purchaser to take the defence of bona fide transfer for value without notice of the original contract. Accordingly, we take the view that lis pendens affects the transferee pendente lite and Section 52 of the Transfer of Property Act is not subject to Section 19(b) of the new Specific Relief Act. The conveyance in favour of the subsequent purchaser pending the suit brought by the plaintiff contractor for specific performance of the contract between him and the vendor is taken "as if it had never any existence."
20. The Hon'ble Supreme Court also held in Chander Bhan (D)'s case (supra) that the protection of Section 41 of Property Act is not available to the transferee pendente lite. It was observed:-
16. The object underlying the doctrine of lis pendens is for maintaining a status quo that cannot be affected by an act of any party in a pending litigation. The objective is also to prevent multiple proceedings by parties in different forums. The principle is based on equity and good conscience. This Court has clarified this position in a catena of cases. Reference may be made here of some, such as Rajendra Singh v. Santa Singh, (1973) 2 SCC 705: AIR 1973 SC 2537; Dev Raj Dogra v. Gyan Chand Jain, (1981) 2 SCC 675; Sunita Jugalkishore Gilda v. Ramanlal Udhoji Tanna, (2013) 10 SCC 258.::: Downloaded on - 15/06/2024 20:29:44 :::CIS 25
17. It must be stated here though that by virtue of Section 1 of the Transfer of Property Act, 1882 the provisions of the said Act are not applicable in the States of Punjab, Delhi or Bombay; subject, of course to certain .
exceptions. Yet, in the case of Kanshi Ram v. Kesho Ram, AIR 1961 P&H 299 the Punjab and Haryana High Court has held that since the explanation to Section 52 is based on equity and good conscience this principle can be applicable.
Recently, this Court in Shivshankara v. H.P. Vedavyasa Char, 2023 SCC OnLine SC 358 held as follows:
"....Even if it is taken for granted that the provisions under Section 52 of the Transfer of Property Act are not applicable as such in the case on hand it cannot be disputed that the principle contained in the provision is applicable in the case on hand. It is a well-nigh settled position that wherever TP Act is not applicable, such principle in the said provision of the said Act, which is based on justice, equity and good conscience is applicable in a given similar circumstance, like Court sale etc....."
In short, there can be no doubt that even if Section 52 of the T.P. Act is not applicable in its strict sense in the present case then too the principles of lis-pendens, which are based on justice, equity and good conscience, would certainly be applicable.
18. Keeping this in mind, the explanation to Section 52 which was inserted by Act No. XX of 1929, clarifies that the pendency of a suit shall be deemed to have commenced from the date on which the plaintiff presents the suit. Further, such pendency would extend till a final decree is passed and such decree is realised.
19. In the facts of the present case, the suit for permanent injunction was filed on 21.07.2003 which is prior to the execution of the release deed, i.e., 28.07.2003. Thus, since the release deed was executed after the suit for temporary injunction was filed by the appellant, the alienation made by respondent no. 3 in favour of respondent no. 4 would be covered by the doctrine of lis pendens.
::: Downloaded on - 15/06/2024 20:29:44 :::CIS 2620. In other words, the appellant filed a suit for permanent injunction on 21.07.2003 and obtained an order of temporary injunction on 28.07.2003. As of 21.07.2003, the doctrine of lis pendens would take effect. The release deed .
executed by respondent no. 3 in favour of respondent no. 4 was on 28.07.2003, which is after the filing of the suit. Respondent no. 4 executed the registered sale deed in favour of respondents 1-2 on 16.06.2004 which is during the operation of the temporary injunction order. Thus, the alienation made by respondents, cannot operate against the interests of the appellant considering he had obtained an order of temporary injunction in his favour. The same position has been held by this Court in a recent decision of Shivshankara v. H.P. Vedavyasa Char (Supra), which has similar facts in the context of an injunction order.
21. Once it has been held that the transactions executed by the respondents are illegal due to the doctrine of lis pendens the defence of the respondents 1-2 that they are bonafide purchasers for valuable consideration and thus, entitled to protection under Section 41 of the Act of 1882 is liable to be rejected.
21. The objectors filed the objections to the execution petition; however, the Order 21 Rule 102 of CPC provides that a transferee pendente lite is not entitled to raise obstruction to the execution of the decree. It was laid down by Hon'ble Supreme Court in Usha Sinha v. Dina Ram, (2008) 7 SCC 144,that transferee is presumed to be aware of the proceedings before the Court of law and cannot raise an objection in view of Order 21 Rule 102 of CPC.
It was observed:-
::: Downloaded on - 15/06/2024 20:29:44 :::CIS 2717. Rule 102 clarifies that Rules 98 and 100 of Order 21 of the Code do not apply to transferee pendente lite. That Rule is relevant and material and may be quoted in extenso:
"102. Rules not applicable to transferee pendente lite.--
.
Nothing in Rules 98 and 100 shall apply to resistance or obstruction in the execution of a decree for the possession of immovable property by a person to whom the judgment-debtor has transferred the property after the institution of the suit in which the decree was passed or to the dispossession of any such person."
A bare reading of the Rule makes it clear that it is based on justice, equity and good conscience. A transferee from a judgment-debtor is presumed to be aware of the proceedings before a court of law. He should be careful before he purchases the property which is the subject matter of litigation. It recognises the doctrine of lis pendens recognised by Section 52 of the Transfer of Property Act, 1882 [ "52. Transfer of property pending suit relating thereto.--During the pendency in any court having authority within the limits of India excluding the State of Jammu and Kashmir or established beyond such limits by the Central Government of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceeding so as to affect the rights of any other party thereto under any decree or order which may be made therein, except under the authority of the court and on such terms as it may impose.Explanation.--For the purposes of this section, the pendency of a suit or proceeding shall be deemed to commence from the date of the presentation of the plaint or the institution of the proceeding in a court of competent jurisdiction, and to continue until the suit or proceeding has been disposed of by a final decree or order and complete satisfaction or discharge of such decree or order has been obtained, or has become unobtainable by reason of the expiration of any period of limitation prescribed for the execution thereof by any law for the time being in force."] . Rule 102 of Order 21 of the Code thus takes into account the ground reality and refuses to extend a helping hand to purchasers of property in respect of which litigation is ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 28 pending. If unfair, inequitable or undeserved protection is afforded to a transferee pendente lite, a decree-holder will never be able to realise the fruits of his decree. Every time the decree-holder seeks a direction from a court to execute the .
decree, the judgment-debtor or his transferee will transfer the property and the new transferee will offer resistance or cause obstruction. To avoid such a situation, the Rule has been enacted.
18. Before one-and-half century, in Bellamy v. Sabine [(1857) 1 De G & J 566: 44 ER 842], Lord Cranworth, L.C. proclaimed that where litigation is pending between a plaintiff and a defendant as to the right to a particular estate, the necessities of mankind require that the decision of the court in the suit shall be binding not only on the litigating parties, but also on those who derive title under them by alienations made pending the suit, whether such alienees had or had not notice of the pending proceedings. If this were not so, there could be no certainty that the litigation would ever come to an end.
19. Keeping in view the avowed object, the expression "transferee from the judgment-debtor" has been interpreted to mean the "transferee from a transferee from the judgment-debtor" (vide Vijayalakshmi Leather Industries (P) Ltd. v. K. Narayanan [AIR 2003 Mad 203] ).
20. In Vijayalakshmi Leather Industries [AIR 2003 Mad 203] it was urged that the provisions of Rules 98 and 100 of Order 21 of the Code had limited application to the transferee of the judgment-debtor and could not extend to "a chain of transactions" where the transferee of the judgment-debtor had transferred his interest.
21. Referring to statutory provisions and case law, the Court negatived the contention, stating : (Vijayalakshmi case [AIR 2003 Mad 203], AIR p. 206, para 13) "13. If such contention of the learned Senior Counsel for the appellant is to be accepted, then we are closing our eyes regarding the intention of the statute. It is obvious while interpreting the provisions of the statute, the court must give due weight to the intention of the statute in order to give effect to the provisions. If any narrow interpretation is given and thereby the purpose of the ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 29 statute is being defeated, the courts must be careful to avoid such interpretations. If we look at Section 52 of the Transfer of Property Act and Rule 102 of Order 21 CPC, it is very clear that the intention of Parliament with which .
the statute had been enacted is that the rights of one of the parties to the proceeding pending before the court cannot be prejudiced or taken away or adversely affected by the action of the other party to the same proceeding.
In the absence of such restriction one party to the proceeding, just to prejudice the other party, may dispose of the properties which is the subject matter of the litigation or put any third party in possession and keep away from the court. By such actions of the party to the litigation the other party will be put to more hardship and only to avoid such prejudicial acts by a party to the litigation these provisions are in existence. When despite such statutory restrictions, for the transfer of the properties, which are the subject matter of litigation by a party to the proceeding, the courts are duty-bound to give effect to the provisions of the statute."
22. The above observations, in our opinion, lay down the correct proposition of law.
23. It is thus settled law that a purchaser of suit property during the pendency of litigation has no right to resist or obstruct the execution of the decree passed by a competent court. The doctrine of "lis pendens" prohibits a party from dealing with the property which is the subject matter of the suit. "Lis pendens" itself is treated as constructive notice to a purchaser that he is bound by a decree to be entered in the pending suit. Rule 102, therefore, clarifies that there should not be resistance or obstruction by a transferee pendente lite.
It declares that if resistance is caused or obstruction is offered by a transferee pendente lite of the judgment-debtor, he cannot seek the benefit of Rules 98 or 100 of Order 21.
24. In Silverline Forum (P) Ltd. v. Rajiv Trust [(1998) 3 SCC 723] this Court held that where the resistance is caused or obstruction is offered by a transferee pendente lite, the scope of adjudication is confined to a question of whether he was a transferee during the pendency of a suit in which ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 30 the decree was passed. Once the finding is in the affirmative, the executing court must hold that he had no right to resist or obstruct and such a person cannot seek protection from the executing court. The Court stated : (SCC .
pp. 727-28, para 10) "10. It is true that Rule 99 of Order 21 is not available to any person until he is dispossessed of immovable property by the decree-holder. Rule 101 stipulates that all questions 'arising between the parties to a proceeding on an application under Rule 97 or Rule 99' shall be determined by the executing court if such questions are 'relevant to the adjudication of the application'. A third party to the decree who offers resistance would thus fall within the ambit of Rule 101 if adjudication is warranted as a consequence of the resistance or obstruction made by him to the execution of the decree. No doubt if the resistance was made by a transferee pendente lite of the judgment-debtor, the scope of the adjudication would be shrunk to the limited question of whether he is such a transferee and on a finding in the affirmative regarding that point the execution court has to hold that he has no right to resist in view of the clear language contained in Rule
102. Exclusion of such a transferee from raising further contentions is based on the salutary principle adumbrated in Section 52 of the Transfer of Property Act."
(emphasis supplied) (See also Sarvinder Singh v. Dalip Singh [(1996) 5 SCC 539] .)
25. We are in respectful agreement with the proposition of law laid down by this Court in Silverline Forum [(1998) 3 SCC 723]. In our opinion, the doctrine is based on the principle that the person purchasing a property from the judgment- debtor during the pendency of the suit has no independent right to property to resist, obstruct or object to the execution of a decree. Resistance at the instance of the transferee of a judgment-debtor during the pendency of the proceedings cannot be said to be resistance or obstruction ::: Downloaded on - 15/06/2024 20:29:44 :::CIS 31 by a person in his own right and, therefore, is not entitled to get his claim adjudicated.
26. For invoking Rule 102, it is enough for the decree- holder to show that the person resisting the possession or .
offering obstruction is claiming his title to the property after the institution of the suit in which the decree was passed and sought to be executed against the judgment- debtor. If the said condition is fulfilled, the case falls within the mischief of Rule 102 and such applicant cannot place reliance either on Rule 98 or Rule 100 of Order 21.
22. In view of the above there is no infirmity in the order passed by the learned Trial Court. Hence, the present petition fails and the same is dismissed. Pending miscellaneous applications, if any, also stand disposed of.
23. Parties through their respective counsel are directed to appear before the learned Trial Court on 09.07.2024.
24. The observation made hereinabove shall remain confined to the disposal of the petition and will have no bearing, whatsoever, on the merits of the case.
(Rakesh Kainthla) Judge 15th June, 2024.
(Ravinder) ::: Downloaded on - 15/06/2024 20:29:44 :::CIS