Delhi District Court
Shiv Kumar Sharma vs Ramesh Chander And Ors on 30 January, 2026
IN THE COURT OF MS. SHILPI M JAIN : DISTRICT JUDGE-05,
SOUTH WEST DISTRICT, DWARKA COURTS, NEW DELHI
CS DJ ADJ 250/2017
CNR No. DLSW010022062017
IN THE MATTER OF :
SHIV KUMAR SHARMA,
S/o Shri Vishnu Dutt Sharma,
R/o 217, Lal Jyoti Apartments,
Sector 9, Rohini.
New Delhi-110005. .................Plaintiff
Versus
1. SHRI RAMESH CHANDER
S/o Sh. Jai Kumar
R/o Flat No. 653, Bahawalpur CGHS.
Ltd. Plot No. 1. Sector - 4,
Dwarka, New Delhi-110075
2. JAI PRAKASH SAINI
S/o Shri Sher Singh Saini
R/o Flat No. 605, NIJI C.G.H.S. Ltd.,
Saksham Appt., Plot No. 40,
Sector-10, Dwarka,
New Delhi-110075
3. RAM KUMAR SEHRAWAT
S/o Late Shri Gokal Chand
R/o Flat No. C-601,
6 Floor, Block No. 4,
Delhi State Newspaper Employees Federation C.G.H.S. Ltd.
SHILPI
M JAIN Plot No. 1, Sector-19, Dwarka,
Digitally signed
by SHILPI M JAIN
Date: 2026.01.30
CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 1 of 48
17:00:10 +0530
New Delhi-110075
4. SMT. SANTOSH SEHRAWAT
W/o Sh. Ram Kumar Sehrawat
R/o Flat No. C-601,
6th Floor, Block No. 4,
Delhi State Newspaper Employees Federation C.G.H.S. Ltd.
Plot No. 1, Sector-19, Dwarka,
New Delhi-110075 ..................Defendants
Date of institution of the suit : 07.03.2017
Final Arguments heard on : 23.07.2025
Date of Judgment : 30.01.2026
SUIT FOR CANCELLATION OF SALE DEED, DECLARATION,
PERMANENT INJUNCTION AND POSSESSION
INDEX
FACTUAL BACKGROUND ....................5
ISSUES .....................10
EVIDENCE GIVEN BY PARTIES .....................12
SUBMISSIONS OF THE PARTIES .....................18
ISSUEWISE ANALYSIS & FINDINGS ....................22
• Concept of 'SALE' under Transfer of
....................31
Property Act, 1882
• Law on Declaration/Cancellation ....................32
• Defendant's role as 'Secured Creditor' or
'Joint Purchaser' ....................39
• Maintainability of Alternative Prayer ....................40
• Delhi State Newspaper Employees
Federation CGHS Ltd. is necessary
party? ....................42
SHILPI
M JAIN
Digitally signed
by SHILPI M JAIN
Date: 2026.01.30
CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 2 of 48
17:00:13 +0530
• Regarding joint and several liability ....................45
CONCLUSION ....................45
JUDGMENT :
1. Plaintiff filed the present suit for cancellation of sale deed, declaration, permanent injunction and possession qua the property i.e. Flat No. C-1/601, 6th Floor, Block No.4, Delhi State Newspaper Employees Federation CGHS Ltd, located at Plot no. 1. Sector-19. Dwarka, New Delhi- 110075 (hereinafter referred to as "suit property") against the defendants with the following relief:
"(a) Pass a Decree for CANCELLATION of the Sale Deed dated 20.10.2014 registered at the office of the Sub Registrar IX, New Delhi with registration no. 12248 in Book No. 1 Vol. No. 7931 on page 93 to 99 on 25.10.2014 thereby declaring the same as null and void;
(b) Pass a Decree of DECLARATION in favour of the Plaintiff and against the Defendants thereby declaring the Release Deed dated 19.12.2014registered at the office of the Sub Registrar IX, New Delhi with registration no. 14320 in Book No. 1 Vol. No. 8016 on page 89 to 93 on20.12.2014 as illegal, null and void being based on the void Sale Deed dated 20.10.2014 and consequently not binding on the Plaintiff and not affecting the right and title of the Plaintiff in respect of the Suit Property bearing Flat No. C-1/601, 6 Floor, Block No. 4, Delhi State Newspaper Employees Federation C.G.H.S. Ltd. located at Plot No. 1, Sector-19, Dwarka, New Delhi-110075;
(c) Pass a Decree of DECLARATION in favour of the Plaintiff and against the Defendants thereby declaring the Sale Deed SHILPI dated 20.03.2015 registered at the office of the Sub Registrar M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 3 of 48 17:00:14 +0530 IX. New Delhi with registration no. 2839 in Book No. 1 Vol.
No. 8169 on page 80 to 87 on21.03.2015 as illegal, null and void being based on the void Sale Deed dated 20.10.2014 and void Release Deed dated 19.12.2014 and consequently not binding on the Plaintiff and not affecting the right and title of the Plaintiff in respect of the Suit Property bearing Flat No. C- 1/601, 6 Floor, Block No. 4, Delhi State Newspaper Employees Federation C.G.H.S. Ltd. located at Plot No. 1, Sector-19, Dwarka, New Delhi-110075;
(d) Pass a Decree of DECLARATION in favour of the Plaintiff and against the Defendants thereby declaring the Plaintiff to be the exclusive owner of the Suit Property bearing Flat No. C-1/601, 6th Floor, Block No. 4, Delhi State Newspaper Employees Federation C.G.H.S. Ltd. located at Plot No. 1, Sector-19, Dwarka, New Delhi -110075;
(e) Pass a Decree for PERMANENT INJUNCTION in favour of the Plaintiff and against the Defendants, their agents, associates, attorneys, nominees, servants, assignees, executors, authorized representatives or anybody acting on their behalf, thereby restraining them from selling, alienating, transferring, creating any third party interest or encumbering the Suit Property bearing Flat No. C-1/601, 6 th Floor, Block No. 4, Delhi State Newspaper Employees Federation CGHS Ltd. located at Plot No. 1, Sector-19, Dwarka, New Delhi 110075, in any manner whatsoever, and to further restrain the Defendants and their associates, etc. from claiming any rights over the Suit Property on the basis of the void Sale Deed dated 20.10.2014, void Release Deed dated 19.12.2014andvoid Sale Deed dated 20.03.2015,
f) Pass a Decree for POSSESSION in favour of the Plaintiff and against the Defendants thereby directing the Defendant Nos. 3 and 4 to hand over vacant physical possession of the Suit Property bearing Flat No. C-1/601, 6 Floor, Block No. 4. Delhi State Newspaper Employees Federation C.G.H.S. Ltd. SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 4 of 48 17:00:12 +0530 located at Plot No. 1, Sector-19, Dwarka, New Delhi-110075 to the Plaintiff
g) It is further prayed that in the event of this Hon'ble Court coming to a conclusion that the aforesaid main prayer sought by the plaintiff is not possible for any reason, then in such an event, a Decree of RECOVERY of a sum of Rs. 44,20,000/- along with 18% interest from date of sale deed till realization, against the Defendant no. 1 and 2 jointly or severally, in accordance with the provisions of the Specific Relief Act, 1963;
h) Award the costs of the suit in favour of the Plaintiff and against the Defendants;
i) Pass such other or further order(s) as this Hon'ble Court may deem fit and proper in the circumstances of the present case."
FACTUAL MATRIX
2. Facts of the case which are imperative to adjudicate issues involved in this matter are succinctly recapitulated: The plaintiff has filed the present suit claiming to be the original and absolute owner of the immovable property, admeasuring 50.2 sq. m bearing Flat No. C-1/601, 6th Floor, Block No.4, Delhi State Newspaper Employees Federation CGHS Ltd, located at Plot no. 1, Sector-19. Dwarka, New Delhi-110075 (hereinafter referred to as "suit property"). It is further averred that, the plaintiff was alloted the suit property in August, 2012 by virtue of his membership in the housing society on the basis of draw of lots conducted by the Delhi Development Authority on 19.06.2012. It is further averred that, the plaintiff got the suit property converted from leasehold to freehold by paying the requisite conversion charges to DDA and a conveyance deed dated 27.12.2013 was executed by the DDA in his favour. It is further averred that, after negotiations with defendant nos. 1 & 2, plaintiff executed a sale deed on 20.10.2014 in respect SHILPI M JAIN of the suit property in favour of defendant nos. 1 & 2 who tendered four Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 5 of 48 17:00:09 +0530 cheques drawn in favour of the housing society i.e. Delhi State Newspaper Employees Federation CGHS Ltd., to the plaintiff as payment of the sale consideration for an amount of Rs. 44,20,000/- details of which are as follows:
i) Cheque bearing no. 356709 dated 20.10.2014 for an amount of Rs.
10,00,000/- (Rupees Ten Lac only) drawn on ING Vysya Bank Ltd. (Dwarka Branch):
ii) Cheque bearing no. 356710 dated 20.10.2014 for an amount of Rs.
10,00,000/- (Rupees Ten Lac only) drawn on ING Vysya Bank Ltd. (Dwarka Branch):
iii) Cheque bearing no. 356711 dated 20.10.2014 for an amount of Rs.
10,00,000/- (Rupees Ten Lac only) drawn on ING Vysya Bank Ltd. (Dwarka Branch);
iv) Cheque bearing no. 356713 dated 20.10.2014 for an amount of Rs.
14,20,000/- (Rupees Fourteen Lac Twenty Thousand only) drawn on ING Vysya Bank Ltd. (Dwarka Branch).
3. It is further averred that, immediately after the registration of the sale deed on 25.10.2014, defendant nos. 1 & 2 asked the plaintiff not to give the cheques to the housing society to present or deposit the said cheques in any bank as there were insufficient funds in the bank account of defendant no.2 from which the said cheques have been issued. It is further averred that since the sale consideration recited in the sale deed registered on 25.10.2014 was not paid, the plaintiff cancelled the same and no title and possession was transferred to defendant nos. 1 & 2.
4. It is further averred that, an illegal release deed dated 19.12.2014 SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 6 of 48 17:00:11 +0530 was executed by defendant no.1 in favour of defendant no.2 in respect of the suit property and on the strength of the aforesaid release deed, defendant no.2 executed an illegal sale deed dated 20.03.2015 in favour of defendant nos. 3 & 4 for a sale consideration of Rs. 48,00,000/-. It is further averred that the plaintiff became aware of the execution of the release deed dated 19.12.2014 and the sale deed dated 20.03.2015 only in January, 2017 when summons of the suit for declaration and permanent injunction filed by defendant nos, 3 & 4 in respect of the suit property was served on him. It is further averred that, the said suit is still pending adjudication and vide order dated 03.02.2017, the Ld. Civil Judge allowed the application of defendant nos. 3 & 4 for temporary injunction in respect of their possession.
5. It is further averred that although the original sale deed dated 20.10.2014 records that vacant physical possession of the suit property was handed over to the defendant nos. 1 & 2 at the time of execution of the said deed, no actual delivery of possession, in fact, took place. It is further averred that due to non-realization of payment of sale consideration mentioned in the original sale deed dated 20.10.2014, the purported sale of the suit property was cancelled and the physical possession of the same was not handed over to the defendant nos. 1 & 2. Although, the title of the suit property is with the plaintiff, the vacant physical possession of the same had not been handed over to the plaintiff by the housing society till date due to non-payment of outstanding demand. Thus, since the vacant physical possession of the suit property was never with the plaintiff in the first place, the same could not have been handed over to the defendant nos. 1 & 2 and subsequently the defendant nos. 3 & 4 have trespassed into the suit property by breaking common wall with adjoining property through taking advantage of the fact SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 7 of 48 17:00:15 +0530 that the suit property and the adjoining property i.e. Flat no. C-601 (allegedly owned by the defendant no. 3 and 4) share a common entrance.
6. It is further averred that, on the basis of the aforesaid facts, the plaintiff has prayed for cancellation of the sale deed dated 20.10.2014 and declaration of the release deed dated 19.12.2014 and sale deed dated 20.03.2015 and void and non est and the plaintiff be declared as exclusive owner of the suit property.
7. Summons of the suit were issued to defendants. Defendant no.1 and defendant nos. 3 & 4 filed their respective written statements. However, defendant no. 2 failed to enter his appearance despite service and thus, he was proceeded ex-parte vide order dated 21.04.2017.
WRITTEN STATEMENT FILED BY DEFENDANT NO . 1
8. In the written statement filed by defendant no.1, it was stated that the suit suffers from misjoinder of the parties and defendant no. 1 has been wrongly and malafidely impleaded as a party in the suit. It is further stated that, defendant no. 1 neither purchased the suit property nor tendered any amount or cheque to the plaintiff and he was given the share in the suit property as a security by defendant no.2 and one Sh. Subhash Dabas who was claimed to be the real owner of the suit property. It is further stated that the defendant no. 2 had landed Rs. 20,00,000/- to the defendant no.2 and in order to secure his loan, defendant no.1 was given the ownership right by defendant no.2 and when defendant no. 1 has received his money from defendant no.2, then defendant no. 1 had executed a release deed in favour of defendant no.2. It is further stated that all these facts were within the knowledge of the SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 8 of 48 17:00:15 +0530 plaintiff hence, the present suit is misuse of process of law. In parawise reply, defendant no. 1 denied the entire contents of the plaint and strongly denied that there was any conspiracy between the defendants to secure the possession of the suit property and on the other hand it is the plaintiff in collusion with Sh.Subhash Dabas hatched this entire conspiracy with ulterior motives and that the FIR dated 02.02.2017 is false and misuse of law. It is further stated that, defendant no. 1 did not take the possession of the suit property at any point of time, as he was possessing the share of the suit property as security and not as an absolute owner. Lastly, it is stated that the plaintiff is neither entitled for the suit property nor for the money as prayed for alternatively because he has never been the owner in possession of the suit property.
WRITTEN STATEMENT FILED BY DEFENDANT NO . 3 and 4
9. In the joint written statement filed by defendant nos. 3 & 4, it is stated that they have purchased the suit property vide registered sale deed dated 20.03.2015 after due diligence and having verified the title documents in favour of defendant no. 2 and paid a valuable consideration of Rs. 48,00,000/-through RTGS into the account of defendant no.2. It is further stated that they have been in the use and occupation of the suit property since it is purchased from its earstwhile registered owner. It is further stated that the plaintiff had executed the sale deed dated 20.10.2014 in favour of defendant nos. 1 & 2 and in the sale deed, it is not mentioned that clearance of the cheque is the condition precedent for transfer of the title and possession of the suit property.
SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 9 of 48 17:00:16 +0530
10. It is further stated that the plaintiff conspired with defendant nos. 1 & 2 to cheat innocent persons and therefore he got issued cheques in favour of the society after 20.10.2014 and not in the name of the plaintiff and the plaintiff has failed to initiate any legal proceedings or issued any legal notice for recovery of the cheque amount. It is further contended that the plaintiff was sleeping with the cheques without having title and possession of the suit property and no attempt was taken by him to get injunction order against the defendant nos. 1 & 2 to restrain them from creating any third party interest. It is further stated that the present suit has been filed just to harass the defendants no. 3 and 4 for cancellation of sale deeds, possession and permanent injunction but nowhere in the present suit it has been mentioned by the plaintiff as and when and how the demand against the cheques were raised against defendant nos. 1 & 2. It is therefore prayed that the suit of the plaintiff be dismissed with cost.
11. Separate replications to the written statements of defendant no. 1 and defendant no. 3 and 4 were filed on behalf of the plaintiff, thereby, reiterating and reaffirming the contents of the plaint.
ISSUES :
12. From the pleadings of parties, issues were framed by Ld. Predecessor of this court vide order dated 10.07.2017 which were restructured after framing additional issue vide order dt. 23.08.2017 as follows:
i. Whether defendant no.1 had lent Rs.20 lakhs to defendant no.2 Sh. Jai Parkash Saini in order to secure his loan?OPD-1 SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 10 of 48 17:00:13 +0530 ii. Whether defendant nos.3 & 4 purchased the suit property after due diligence and verifying the title documents in favour of defendant no.2 for a valuable consideration of Rs.48 lakhs?OPD3 & 4 iii. Whether the plaintiff is entitled to a decree for cancellation of sale deed dated 20.10.2014 registered at the office of Sub Registrar IX, New Delhi with registration no.12248 in book no.1 vol. no.7931 on page 93 to 99 on 25.10.2014 thereby declaring the same as null and void?OPP iv. Whether the plaintiff is entitled to a decree for declaration in favour of the plaintiff and against the defendants thereby declaring the release deed dated 19.12.2014 registered at the office of Sub Registrar IX, New Delhi with registration no.14320 in book no.1 vol. no.8016 on page 89 to 93 on 20.12.2014 thereby declaring the same as null and void?OPP v. Whether the plaintiff is entitled to a decree for declaration in favour of the plaintiff and against the defendants thereby declaring the sale deed dated 20.03.2015 registered at the office of Sub Registrar IX, New Delhi with registration no.2839 in book no.1 vol. no.8169 on page 80 to 87 on 21.03.2015 thereby declaring the same as null and void?OPP vi. Whether the plaintiff is entitled to a decree for declaration thereby declaring the plaintiff to be the exclusive owner of suit property bearing flat no.C-1/601, 6th floor, block No.4, Delhi State Newspaper Employees Federation CGHS Ltd. Located at Plot no.1, Sector 19 Dwarka New Delhi-75?OPP vii. Whether the plaintiff is entitled to decree for permanent injunction on the suit property?OPP viii. Whether the plaintiff is entitled to decree for possession of the suit property?OPP ix. Whether the plaintiff is entitled to recovery of sum of Rs. 44,20,000/-, as prayed for? OPP.
x. Relief.
SHILPI
M JAIN
Digitally signed
by SHILPI M JAIN
Date: 2026.01.30
CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 11 of 48
17:00:13 +0530
EVIDENCE GIVEN BY PARTIES
13. In support of his case, plaintiff examined as much as three witnesses. PW-1 Plaintiff/Sh. Shiv Kumar Sharma S/o Sh. Vishnu Dutt Sharmaa tendered her evidence by way of affidavit Ex. PW1/A and has relied upon following documents:
SL. PARTICULARS OF DOCUMENTS EXHIBITS/MARK
NO.
1. Copy of certificate of allotment dated Mark A
19.06.2012
2. Copy of conveyance deed dated Mark B
27.12.2013
3. Certified copy of sale deed dated Ex.PW1/1
20.10.2014 (running into 12 pages)
4. Original four cheques all dated Ex. PW1/2 (colly)
20.10.2014
5. Certified copy of release deed dated Ex. PW1/3
19.12.2014 (running into 11 pages)
6. Certified copy of sale deed dated Ex.PW1/4
20.03.2015 (running into 17 pages)
7. Receipt copy of complaint (running Ex. PW1/5 (colly)
into 5 pages)
8. Copy of FIR no.0036 dated Mark C
02.02.2017
9. Copy of suit CS no.245/2016 filed by Mark D
defendant nos.3 & 4
10. Copy of order dated 03.02.2017 in CS Mark E
no.245/2016
PW1 was cross-examined by Ld. Counsel for defendant no. 1 as well as Ld. Counsel for defendant no. 3 and 4 respectively at length and discharged.
SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 12 of 48 17:00:14 +0530
14. PW2 Sh. Rajat Dagar S/o Sh. Rajpal Dagar, Branch Operation Manager at Kotak Mahindra Bank, Dwarka, Sector-11, New Delhi was a summoned witness who brought the summoned record i.e. Bank statement/statement of account of Sh. Jai Prakash Saini pertaining to account No. 611010018444 for the year 2012 to 2017 consisting total 27 pages, same is Ex. PW2/1 (colly). PW2 also brought the Certificate showing that the cheques bearing nos. 356709, 356710, 356711, 356713 and 356712 have not been passed by our bank for withdrawal or any other mode, same is Ex. PW2/2 (colly). In support of aforementioned documents, PW2 has also brought the Certificate u/s. 65 B of Indian Evidence Act, same is Ex. PW2/3 bearing his signature at point A. PW2 was cross-examined by Ld. Counsel for defendant no. 1 as well as Ld. Counsel for defendant no. 3 and 4 respectively wherein he deposed that the aforementioned cheques were never presented for encashment to the bank as per record.
15. PW-3 Sh. J.B. Kapil, Administrator of Delhi State Newspaper Employees Federation, CGHS Ltd, Plot no. 1, Sector - 19, Dwarka, New Delhi was a summoned witness who brought the summoned record i.e. Membership record of Society and record qua handing over possession of the suit property/flat. PW3 further stated that the record pertaining to the handing over possession of the suit property is not in control and possession of the Society and the same may be with the Builder, previous Management Committee or CBI who have not handed over the same to the Society.
16. PW3 was cross-examined by Ld. Counsel for defendant no. 3 and 4 wherein Witness deposed as below:
SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 13 of 48 17:00:09 +0530 "(Witness is confronted with the original Occupancy Certificate of the flat in the name of the plaintiff Shiv Kr. Sharma and asked whether the said certificate has been issued by the Society). The said certificate has been issued by the Society and the same is now Ex. PW3/D1.
It is correct that prior to getting the flat freehold, it is mandatory for the member to get No Dues Certificate from the society. Voltr. The flats of all the members of the Society shall be freehold by the members as per their sweet will after payment of their dues. I do not know whether prior to getting the flats freehold, a member is required to deposit the Allotment and Occupancy letter with DDA. The possession of the suit flat is not with the Society presently."
However, Ld. counsel for plaintiff has raised objection that Ld. Counsel for defendant no. 3 and 4 is putting his defence to the said summoned witness beyond the scope of the summoned witness and he sought permission of the court to cross-examine PW3.
During cross-examination by Ld. Counsel for plaintiff, PW3 deposed as below:
"I have seen the original Certificate and the copy of the same for the first time in the court today which is already Ex. PW3/D1. I have met only Ranjit Singh and not Manju Duhoon and Neetu. I cannot identify the signatures of any of the aforesaid persons who have signed the said Certificate. The Society does not maintain the record of the aforesaid Certificate. I have deposed that the said Certificate bears the stamp of the Society and mentioned the name of the Society. I have deposed on the basis of my personal knowledge and not on the basis of record. I am not aware whether Flat No. B-501, B-703 and B-404 have been converted into freehold flats or not. The Society maintains the aforesaid record. I have been appointed as Administrator of the Society in the month of March, 2017. The Society has filed a complaint with the Registrar of Co-operative Society for non-supply of the records by the previous managing committee. The Society has copy of the SHILPI same."
M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 14 of 48 17:00:14 +0530 XXXXXX "I have brought two complaints filed against the erstwhile managing committee of the Society and the same are Ex. PW3/D2. As far as record of flat nos. B-501, B-703 and B-404 is concerned, the same is not available with the Society, I was not given the stamp of the Society by the erstwhile managing committee. It is correct that I have not seen the original stamp. I have got made a new stamp of the Society. It is correct that Mr. Ram Kumar Sehrawat was appointed as one of the Advisory members of the Society after taking over the charge of the Society by me as an Administrator. Again said. I wish to see my order."
17. Thereafter, PE stands closed and matter was listed for DE.
18. In support of his case, defendants examined six witnesses in total. D1W1 Sh. Ramesh Chander S/o Sh. Jai Kumar has tendered his affidavit in evidence which is Ex. D1W1/A and also relied upon the following documents:
Sl. No. Particulars of Documents Exhibits/Mark
1. Copy of Promissory Note executed by the Ex. D1W1/1 (OSR)
defendant no. 2
2. Copy of statement of account showing the Ex. D1W1/2
RTGS entries at points A & B in favour of (Colly) (OSR);
defendant no. 2
3. Copy of Acknowledgment of loan and its Ex. D1W1/3 (OSR)
refund
D1W1 was cross-examined by Ld. Counsel for plaintiff and discharged.
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19. D1W2 Sh. Deepayan Goswami, Dy. Manager, Kotak Mahindra Bank, Sector-11, Dwarka, New Delhi was a summoned witness who brought the summoned record i.e. copies of Account Opening Form alongwith documents and statement of account of A/c. bearing no. 611011002772 in the name of JJ Estates pertaining to the period 01.05.2012 to 31.03.2015. The account opening form alongwith documents is Ex. D1W2/1 (Colly). Copy of statement of account is Ex. D1W2/2. D1W2 has also brought the Certificate U/S. 65 B of Indian Evidence Act issued by Ms. Jyoti Shokeen, Branch Operation Manager. Same is Ex. D1W2/3. D1W1 was not cross-examined by Ld. Counsel for plaintiff despite opportunity given.
20. D1W3 Sh. Saurabh Kumar, Branch Manager, Syndicate Bank, Bawana Branch, New Delhi was a summoned witness who brought the summoned record i.e. statement of account bearing No. 90202010054403 pertaining to the period from 01.05.2012 to 31.03.2015 of Rakesh Kumar. D1W3 further deposed that he had himself taken out the print out of the said statement from his bank computer on 09.09.2019, copy of the same is Ex. D1W3/1. (objected to by the counsel for the plaintiff on the ground that the said statement is neither certified by the bank under Bankers Book Evidence Act, 1891 nor it is accompanied by any Certificate U/s. 65 B of Indian Evidence Act). D1W3 was not cross-examined by Ld. Counsel for plaintiff despite opportunity given.
21. D1W4 Sh. Rakesh Kumar S/o late Sh. Lakhmi Chand tendered his evidence by way of affidavit Ex. D1W4/A. D1W4/A was cross-examined by Ld. Counsel for plaintiff and discharged.
SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 16 of 48 17:00:15 +0530
22. D3&4/W1 Sh. Mukesh Kumar Satija, Dy Manager, State Bank of India, Sector-12, Dwarka, New Delhi was a summoned witness who brought the summoned record i.e.Statement of account of account holders namely Mr. Ram Kumar Sehrawat and Ms. Santosh Sehrawat and the vouchers of respective RTGS from the said account. The certified copies of statement of accounts are for the period of 01.02.2015 to 31.03.2015 and the same are at points A in Ex. D3&4/W1/1 and Ex. D3&4/W1/2 respectively. The certified copies of respective vouchers of the RTGS entries are Ex. D3&4/W1/3 & D3&4/W1/4. D3 & 4/W1 was cross-examined by Ld. Counsel for plaintiff wherein he deposed that he has no personal knowledge of the case.
23. D3&4/W2 HC Neelam, No. 2322/DW, Prosecution Branch, Dwarka Courts, New Delhi was a summoned witness who stated that she was working as a Duty Officer in the PS Dwaka Sector-23 on 09.11.2016 from 8 AM to 8 PM. She brought the record of FIR bearing No. 347 dated 09.11.2016, the copy of the same is Ex. D384/W2/1 (OSR). She also brought the FIR register bearing the official copy of FIR No. 369 dated 03.12.2016, the copy of the same is Ex. D3&4/W2/2 (OSR). D3 & 4/W2 was not cross- examined by Ld. Counsel for plaintiff despite opportunity given.
24. D3&4/W3 Sh. Ram Kumar Sehrawat S/o Late Sh. Gokal Chand tendered his evidence by way of affidavit as Ex.D3&4/W3/1 and also relied upon the following documents:
Sl. Particulars of Documents Exhibits/Mark
No.
SHILPI 1. Copy of SPA dt. 19.01.2019 Ex. D3 & 4/W3/A
M JAIN
Digitally signed
by SHILPI M JAIN
Date: 2026.01.30
CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 17 of 48
17:00:11 +0530
(OSR)
2. Copies of passbooks Mark X1 and X2
3. Copy of occupancy certificates Already Ex.PW3/D1
(OSR)
4. Copy of No dues certificate and receipt Mark X3 and X4
5. Copy of MCD receipts Mark X5 and X6
6. Copy of FIR no. 347/2016 Already exhibited
Ex.DW3&4/W2/1
7. Copy of FIR No. 369/2016 Already exhibited
Ex.DW3&4/W2/2
8. Copy of rent agreement dt. 09.03.2017 Mark X-7
D3 & 4/W3 was cross-examined by Ld. Counsel for plaintiff at length and discharged.
25. Thereafter, DE also stands closed and matter was listed for final arguments.
SUBMISSIONS ON BEHALF OF PARTIES
26. Ld. Counsel for plaintiff submits that, due to non realization of payment of sale consideration amount, the sale of the suit property was cancelled by plaintiff on 25.10.2014 and since the sale of the suit property did not effect, neither title nor possession was transferred to defendant no. 1 and
2. Hence, subsequent release deed dt. 19.12.2014 executed by defendant no. 1 in favour of defendant no. 2 for Rs. 22,50,000/- is also invalid. It is further SHILPI submitted that, said release deed is merely a sham transaction and has to be M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 18 of 48 17:00:15 +0530 cancelled. It is further submitted that, defendant no. 2, by virtue of release deed dt. 19.12.2014 executed an illegal sale deed dt. 20.03.2015 in favour of defendant no. 3 and 4 for sale consideration of Rs. 48,00,000/- is also liable to be set aside. It is further submitted that, defendant no. 3 and 4 trespassed to the suit property with dishonest intention and it came to the knowledge of plaintiff only on November, 2016. Hence, plaintiff is entitled for the relief claimed in the plaint. It is further submitted that, defendant no. 3 and 4 instituted a frivolous suit i.e. CS No. 245/2016 which was allowed only on the ground that since impugned sale deed is not declared void by any court of law, defendant no. 3 and 4 are entitled for the relief hence, sale deed may be declared as null and void. Lastly, it is submitted that, though original sale deed dt. 20.10.2014 records that vacant physical possession of the suit property was handed over to defendant no. 1 and 2, infact no actual delivery of possession was made.
27. Per contra, Ld. Counsel for defendant no. 1 submitted that, defendant no. 1 had duly proved on record that defendant no. 1 had advanced a loan of Rs. 20,00,000/- to defendant no. 2 in May, 2012, comprising Rs. 15,00,000/- transferred through RTGS and Rs. 5,00,000/- paid in cash through his brother-in-law, which fact is duly corroborated by banking records as well as consistent oral testimony. It is further submitted that, careful appreciation of respective testimonies of plaintiff witnesses reveals that none of the said witnesses has been able to prove any payment of sale consideration by defendant no. 1, issuance of any cheque by defendant no. 1, delivery of possession of the suit property t defendant no. 1, or commission of any fraudulent act attributable to defendant no. 1. It is further submitted that, PW2 who is the bank official, has categorically deposed that the cheques SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 19 of 48 17:00:08 +0530 allegedly shown towards sale consideration were never encashed and further confirmed that none of the said cheques were issued by Defendant No. 1, thereby completely demolishing the plaintiff's allegation of any monetary transaction or sale consideration having passed from Defendant No. 1. It is further submitted that, it is a settled principle of law that mere allegations, suspicion, or pleadings, in the absence of cogent and reliable documentary evidence, cannot form the basis of a decree for cancellation of documents or recovery of money. It is further submitted that,
28. It is further submitted that, it stands conclusively established from the evidence on record that Defendant No. 1 was never a purchaser under the Sale Deed dated 20.10.2014, he neither paid any sale consideration nor executed the said Sale Deed as a vendee and his association with the suit property was confined strictly to a loan transaction with Defendant No. 2, wherein the original title documents were handed over merely as collateral security. It is further submitted that, upon full repayment of the loan on 18.12.2014, Defendant No. 1 executed the Release Deed dated 19.12.2014 solely to extinguish his security interest, and not to transfer any right, title, or interest in the suit property. It is further submitted that, it is a settled proposition of law that mere deposit of title deeds by way of security does not amount to transfer of ownership or creation of any proprietary interest.
29. It is further submitted that, the burden to prove payment of the alleged sale consideration of ₹44,20,000/- squarely lay upon the plaintiff. Ld. Counsel for defendant no. 1 relied upon the judgment of Union of India v. Ibrahim Uddin, (2012) 8 SCC 148 passed by Hon'ble Supreme Court of India wherein it has been categorically held that the burden of proof lies SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 20 of 48 17:00:09 +0530 squarely upon the party who asserts a fact and such burden never shifts merely on the basis of pleadings. However, the plaintiff has failed to place on record any cogent documentary or oral evidence to establish that any amount whatsoever was ever paid to, received by, or credited in the account of Defendant No. 1. No cheque, bank transfer, receipt, acknowledgment, or admission has been proved against Defendant No. 1. On the contrary, the evidence on record clearly demonstrates that Defendant No. 1 never issued any cheque, never received any part of the alleged sale consideration, and was not a beneficiary of the transaction in question. Mere allegations, in the absence of proof of receipt of money, cannot form the basis of a decree for recovery. In the present case, the plaintiff has failed to discharge this fundamental burden. Lastly, it is prayed that the suit of the plaintiffs may kindly be dismissed with the heavy cost against the defendant no.1, in the interest of justice.
30. Ld. counsel for defendant no. 3 and 4 submitted that they are bonafide purchaser of the suit property and taken the possession from defendant no. 2 only and hence, present suit has no merit and liable to be dismissed. It is further submitted that, plaintiff has taken the cheques in the name of society but admittedly society is not impleaded to the array of parties hence, suit is also barred due to non-joinder of necessary party. Further, cheques were never presented hence, no cause of action arises in favour of plaintiff. Lastly, it is submitted that, merely non-payment of sale consideration cannot be a ground for cancellation of sale deed when plaintiff itself has right to recovery the sale amount. Ld. Counsel for defendant no. 3 and 4 also relied upon the following judgments in support of his contentions:
1. Vidhyadhar Vs Manikrao &Anr (1999)AIR (SC)1441 SHILPI M JAIN 2. Kaliaperumal Vs Rajagopal & Anr (2009) AIR (SC) 2122 Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 21 of 48 17:00:09 +0530
3. Dahiben Vs Arvindbhai Kalyanji Bhanusali (Gajra) (D) Thr LRs & Ors. Civil Appeal No. 9519 of 2019 Passed by Hon'ble Supreme Court of India Dt. July 09,2020 ISSUE-WISE ANALYSIS AND FINDING:
ISSUE NO. (ii): Whether defendant nos.3 & 4 purchased the suit property after due diligence and verifying the title documents in favour of defendant no.2 for a valuable consideration of Rs.48 lakhs? OPD 3 & 4
31. Defendant Nos. 3 and 4 have jointly defended the suit by asserting that they are bona fide purchasers of the suit property for valuable consideration without notice of any defect in the title of Defendant No. 2, from whom they acquired the property vide registered Sale Deed dated 20.03.2015 (Ex. PW1/4). Their written statement emphasizes that prior to the purchase, they conducted due diligence by verifying the chain of title documents, including the Sale Deed dated 20.10.2014 executed by the plaintiff in favour of Defendant Nos. 1 and 2 and the Release Deed dated 19.12.2014 executed by Defendant No. 1 in favour of Defendant No. 2. They claim to have paid the full sale consideration of Rs. 48,00,000/- through RTGS transfers directly into the bank account of Defendant No. 2, and have been in continuous physical possession of the suit property since the date of purchase. They further contend that the plaintiff's suit is barred by delay, laches, and estoppel, as no steps were taken to challenge the 2014 Sale Deed or restrain further alienation until after their purchase, and that the plaintiff's allegations of non-payment under the original transaction do not affect their protected status as innocent third-party purchasers.
SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 22 of 48 17:00:16 +0530
32. In support of their case, Defendant Nos. 3 and 4 examined three witnesses. D3&4/W1 (Mukesh Kumar Satija, Deputy Manager, State Bank of India), who produced certified copies of bank statements for the accounts of Shri Ram Kumar Sehrawat and Smt. Santosh Sehrawat (Ex. D3&4/W1/1 and Ex. D3&4/W1/2), along with RTGS vouchers (Ex. D3&4/W1/3 and Ex. D3&4/W1/4), unequivocally establishing the transfer of Rs. 48,00,000/- to Defendant No. 2's account in March 2015.
33. During cross-examination by the plaintiff's counsel, D3&4/W1 affirmed the authenticity of these records but clarified he had no personal knowledge of the underlying transaction, which does not detract from the documentary probative value.
34. Further, D3&4/W2 (HC Neelam, Duty Officer, PS Dwarka Sector-23) produced copies of FIR No. 347/2016 dated 09.11.2016 i.e. Ex. D3&4/W2/1 and FIR No. 369/2016 dated 03.12.2016 i.e. Ex. D3&4/W2/2, both lodged by or relating to Defendant Nos. 3 and 4 against alleged trespass or interference, demonstrating their proactive steps to protect possession post-purchase. But, no cross-examination was conducted by the plaintiff despite opportunity, rendering these documents unchallenged.
35. The key witness, D3&4/W3 (Shri Ram Kumar Sehrawat, Defendant no. 3/Special Power of Attorney holder for Defendant Nos. 4), tendered his affidavit Ex. D3&4/W3/1, wherein he detailed the due diligence SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 23 of 48 17:00:11 +0530 process. For the purpose of clarification cross-examination of D3&4/W3 is reproduced here-in-below:
"It is correct that I have not filed any documentary proof along with the SPA to show that my wife is suffering from any ailment. It is wrong to suggest that I have deliberately avoided bringing my wife for cross-examination. Source of income of defendant no. 3 and 4 is my pension, my savings, my rental income and we had also sold one property at the relevant time. I do not remember the sale consideration of the property which I had sold. The property was jointly owned by me and my wife. Me and my wife both receive rental in- come on our names. We had only cleared monthly mainte- nance to the society and had also incurred separate expendi- ture for renovation of the flat. I do not remember if I had filed any suit bearing CS no. 245/2016 against plaintiff seek- ing relief of declaration and permanent injunction and I do not remember the status of the said case.
The possession of the flat was handed over to me by Mr. Jai Prakash Saini. It is correct that two flats have one common entry (vol. Infact it has common shared kitchen). The other connected flat was purchased by me on 02.03.2015. The en- try of the suit property is from the other flat which I had pur- chased on 02.03.2015. When I had taken the possession of the suit property, there was no partition between the two flats. The possession of the suit property was handed over to me on 02.03.2015 by Jai Prakash Saini and Yogesh, though, it is written in the sale deed that the same was handed over to us on 20.03.2015. It is correct that in Written Statement I have not mentioned the aforesaid fact that the actual posses- sion of the suit property was taken over by us on 02.03.2015. I do not remember whether the suit bearing CS no. 245/16 was dismissed for non-prosecution on 18.10.2018. We had done due diligence of the suit property and verified the status of the suit property from the Registrar Office and also from the society office. The society office had informed us that there are no dues against the suit property and the Registrar Office informed us that the suit property is free-hold. I had also obtained certified copies of the title of the suit property. SHILPI I have not filed certified copies of the title of the suit prop- M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 24 of 48 17:00:12 +0530 erty in the present suit. It is wrong to suggest that I have not filed the said certified copies of the title of the suit property as I had never obtained the same from Registrar Office. I came to know about the factum of non-payment of sale consideration of the suit property to plaintiff by the defen- dant no. 1 and 2 after filing of the present suit. I could not confront Jai Prakash Saini (defendant no. 2) regarding the same as he could not be traced. I know defendant no. 2 as he had visited our house for some work. I had known defendant no. 2 since 2015. He had come to visit my son and during conversation I had informed him that I intent to buy a flat in Dwarka area. I do not know how long he is known to my son. My son is a lawyer. I had not filed any case against de- fendant no. 2 as I believe that the defendant no. 2 and defen- dant no. 1 as well as plaintiff are all in collusion with each other. I have come to the aforesaid conclusion because the cheques were paid in the name of the society which were never encashed by the plaintiff till the filing of the present suit and also due to the fact that in the records of the society there was no dues standing in the name of the plaintiff. There was no electricity/water connection in the name of defendant no. 2. One Mr. Rajbir Singh Malik is residing in the suit property since 09.03.2017. I have not placed on record any proof to show that Mr. Rajbir Singh is in the possession of the suit property except rent agreement. It is wrong to sug- gest that the Rajbir Singh is not residing in the suit property and therefore I do not have any proof of his possession. It is wrong to suggest that I had created a sham rent agreement in favour of Rajbir Singh to legitimise my possession in the suit property. It is wrong to suggest that my son has any enmity with Mr. Subhash Dabas. (vol. The dispute has arisen after the purchase of the suit property when Subhash Dabas had demanded Rs. 40 lacs from us as he is builder of the society.) The only proof I have is the FIR which my son had registered against Subhash Dabas. My son has registered two FIRs against Mr. Subhash Dabas and no other proceedings are pending against each other. It is wrong to suggest that we in collusion with defendant no. 1 and 2 have cheated the plain- tiff. It is wrong to suggest that I have concocted a false story against Mr. Subhash Dabas in order to create a false defence SHILPI M JAIN against the plaintiff. It is correct that Mr. Subhash Dabas has Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 25 of 48 17:00:16 +0530 no concern with the suit property. I do not know about the status of FIRs registered by my son against Subhash Dabas. It is wrong to suggest that my son Sh. Abhishek Sehrawat is in the business of property dealing and is an associate of de- fendant no. 2. It is wrong to suggest that I am deposing falsely."
(emphasis is mine)
36. Thus, during extensive cross-examination by the plaintiff's counsel, D3&4/W3 remained consistent, admitting that they relied on the registered chain with due diligence i.e. physical inspection of the suit property, verification of registered documents at the Sub-Registrar's office, confirmation of no encumbrances through society records, and satisfaction regarding Defendant No. 2's clear title. He deposed that possession was handed over by Defendant No. 2 at the time of execution, and that the suit property adjoins another flat owned by Defendant Nos. 3 and 4 (Flat No. C-
601), sharing a common entrance, which facilitated seamless occupation. Defendant Nos. 3 and 4 further claim to had no reason to suspect any irregularity given the recitals in the registered deeds.
37. The plaintiff's evidence, particularly PW1's testimony and documents (Ex. PW1/A, Ex. PW1/1 to Ex. PW1/5), fails to impeach Defendant Nos. 3 and 4's position. PW1 admitted in cross-examination that no legal notice was issued to Defendant Nos. 1 and 2 for recovery or cancellation prior to January 2017, when he learned of the 2015 Sale Deed via summons in CS No. 245/2016 filed by Defendant Nos. 3 and 4 for injunction. PW2's bank records confirm non-encashment of the 2014 cheques but do not implicate Defendant Nos. 3 and 4.
SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 26 of 48 17:00:16 +0530
38. PW3 deposed that possession records were not with the society post-freehold conversion and while confronting Ex. PW3/D1 (Occupancy Certificate), he could not verify signatures or maintain records of similar certificates for other flats, underscoring the society's limited role. Thus, the plaintiff's averment of trespass by Defendant Nos. 3 and 4 through a common wall is unsubstantiated, contradicted by their evidence of lawful handover from Defendant No. 2.
39. In considered opinion of this court Defendant Nos. 3 and 4 qualify for protection under Section 41 of the Transfer of Property Act, 18821, which safeguards transfers by ostensible owners where the transferee acts in good faith after reasonable care. The plaintiff's execution of the registered Sale Deed dated 20.10.2014 reciting full consideration and possession handover and subsequent inaction i.e. failing to present cheques, issue notices, or seek injunctions amounted to implied consent, allowing Defendant No. 2 to appear as ostensible owner post-Release Deed dated 19.12.2014.
40. In Gurbaksh Singh v. Nikka Singh2 it was held that:
"7. The general rule is that a person cannot confer a better title than he has. This section is an exception to that rule. Being an exception the 1 41. Transfer by ostensible owner.--Where, with the consent, express or implied, of the persons interested in immoveable property, a person is the ostensible owner of such property and transfers the same for consideration, the transfer shall not be voidable on the ground that the transferor was not authorised to make it:
Provided that the transferee, after taking reasonable care to ascertain that the transferor had power to make the transfer, has acted in good faith.
SHILPI 2 1962 SCC OnLine SC 341 : 1963 Supp (1) SCR 55 : AIR 1963 SC 1917 M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 27 of 48 17:00:13 +0530 onus certainly is on the transferee to show that the transferor was the ostensible owner of the property and that he had, after taking reasonable care to ascertain that the transferor had power to make the transfer, acted in good faith. "
(emphasis is mine)
41. Similarly in Seshmull M. Shah v. Sayed Abdul Rashid 3 it was held:
"Section 41 of the Transfer of Property Act is in the nature of an exception to the Rule that a person cannot confer better title than he has. The Section provides that a transfer shall not be avoidable on the ground that the transferor was not authorised to make it where, with the consent express or implied of the real owner, the transferor is the ostensible owner of such property and transfers the same for consideration. The Section obliges the transferee in all such cases to make reasonable enquiries to ascertain that the transferor had power to make the transfer, and in addition the transferee must have acted in good faith. This is based on the principle of equity that one, who allows another to hold himself out as the owner of an estate and a third party purchased for value from the apparent owner in the belief that he is the real owner, the man, who so allows the other to hold himself out, shall not be permitted to recover upon his secret title, unless he can over throw that purchaser by showing either that he had direct notice or something which amounts to constructive notice of the real title, or that there existed circumtances which ought to have put him upon an enquiry, which if prosecuted would have lead to a discovery of it. (See: Ramcoomar v. Macqueen) [52 I.A. Supp. 40.] .
It is equally well settled, and the Section is quite clear, that the real owner must have by his consent express or implied held out the ostensible owner as the owner of the property. If either by words or by conduct, he induced others to treat such a person as the real owner and to do that from which they might have abstained, he cannot question the legality of the Act to the prejudice of those who acted in good faith. Mere possession of a Manager cannot be treated as ostensible ownership with the consent of the real owner. In every case, where a transferee for valuable consideration seeks protection SHILPI 3 1990 SCC OnLine Kar 392 : ILR 1991 Kar 2857 : (1991) 1 Kant LJ 320 : AIR 1991 Kar 273 at page 2864 M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 28 of 48 17:00:14 +0530 under Section 41 of the Transfer of Property Act, he must show that it was the real owner, who permitted or created the apparent ownership of the transferor either by express words or consent or by acts or conduct, which imply consent. Conversely, it must be held that if the real owner was not responsible for permitting or creating the apparent ownership, the protection under Section 41 will not be available to a transferee from such person because such a person cannot be said to be an ostensible owner as his claim to ownership does not arise from the consent of the real owner. In substance, before one can be considered to be an ostensible owner, it must be shown that it was with the consent express or implied of the true owner that he was enabled to represent himself as the owner of the property to a bonafide purchaser for value without notice. If it is found that the so called ostensible owner by any fraudulent means created documents without the knowledge of the real owner and represented himself as the owner of the property, Section 41 of the Transfer of Property Act will not protect the interest of a transferee from such a person and it must be held that the ostensible ownership of the property is not created by an act of the real owner or with his consent express or implied. Indeed such a person cannot claim himself to be an ostensible owner. Section 41, in my view, incorporates a Rule akin to the Rule of estoppel whereby the real owner, who by reason of his conduct or express or implied consent was responsible for the creation of an ostensible ownership, cannot be permitted to set up his real ownership to defeat the rights of a bonafide purchaser acting in good faith and who despite reasonable enquiries could not discover such real ownership. It is, therefore, the conduct of the real owner which gives rise to an equity in favour of a bonafide purchaser acting in good faith. Section 41 is a statutory recognition of this equitable Rule."
(emphasis is mine)
42. Thus, in present matter, Defendant Nos. 3 and 4's due diligence and lack of notice satisfy the proviso to Section 41. The delay from 2014 to 2017 further disentitles the plaintiff to equitable relief under Section 20 of the Specific Relief Act, 19634, as laches prejudice innocent third parties. SHILPI 4 20. Substituted performance of contract.--(1) Without prejudice to the generality of the provisions M JAIN contained in the Indian Contract Act, 1872 (9 of 1872), and, except as otherwise agreed upon by the parties, Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 29 of 48 17:00:09 +0530
43. In conclusion, the court finds that Defendant Nos. 3 and 4 are bona fide purchasers for value without notice, holding valid title and possession of the suit property. In view thereof this issue is decided in favour of defendant no. 3 and 4 and against the plaintiff.
ISSUE NO. (iii): Whether the plaintiff is entitled to a decree for cancellation of sale deed dated 20.10.2014 registered at the office of Sub Registrar IX, New Delhi with registration no.12248 in book no.1 vol. no.7931 on page 93 to 99 on 25.10.2014 thereby declaring the same as null and void? OPP ISSUE NO. (iv): Whether the plaintiff is entitled to a decree for declaration in favour of the plaintiff and against the defendants thereby declaring the release deed dated 19.12.2014 registered at the office of Sub Registrar IX, New Delhi with registration no.14320 in book no.1 vol. no.8016 on page 89 to 93 on 20.12.2014 thereby declaring the same as null and void? OPP where the contract is broken due to non-performance of promise by any party, the party who suffers by such breach shall have the option of substituted performance through a third party or by his own agency, and, recover the expenses and other costs actually incurred, spent or suffered by him, from the party committing such breach.
(2) No substituted performance of contract under sub-section (1) shall be undertaken unless the party who suffers such breach has given a notice in writing, of not less than thirty days, to the party in breach calling upon him to perform the contract within such time as specified in the notice, and on his refusal or failure to do so, he may get the same performed by a third party or by his own agency:
Provided that the party who suffers such breach shall not be entitled to recover the expenses and costs under sub-section (1) unless he has got the contract performed through a third party or by his own agency. (3) Where the party suffering breach of contract has got the contract performed through a third party or by his own agency after giving notice under sub-section (1), he shall not be entitled to claim relief of specific performance against the party in breach.
SHILPI (4) Nothing in this section shall prevent the party who has suffered breach of contract from claiming M JAIN compensation from the party in breach Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 30 of 48 17:00:12 +0530 ISSUE NO. (v): Whether the plaintiff is entitled to a decree for declaration in favour of the plaintiff and against the defendants thereby declaring the sale deed dated 20.03.2015 registered at the office of Sub Registrar IX, New Delhi with registration no.2839 in book no.1 vol. no.8169 on page 80 to 87 on 21.03.2015 thereby declaring the same as null and void? OPP ISSUE NO. (vi): Whether the plaintiff is entitled to a decree for declaration thereby declaring the plaintiff to be the exclusive owner of suit property bearing flat no.C-1/601, 6th floor, block No.4, Delhi State Newspaper Employees Federation CGHS Ltd. Located at Plot no.1, Sector 19 Dwarka New Delhi-75? OPP ISSUE NO. (vii): Whether the plaintiff is entitled to decree for permanent injunction on the suit property? OPP ISSUE NO. (viii): Whether the plaintiff is entitled to decree for possession of the suit property? OPP
44. Above issues are interlinked, as the reliefs of cancellation, declaration of ownership, injunction, and possession depend primarily on the validity of the impugned deeds and the plaintiff's title. Hence, taken simultaneously.
Concept of 'SALE' under Transfer of Property Act, 1882
45. At this juncture, it is imperative to discuss the law on sale of immovable property and declaration/cancellation. Section 54 of Transfer of Property Act provides that, "Sale" is a transfer of ownership in exchange for a price paid or promised or part-paid and part-promised.
Sale how made.--Such transfer, in the case of tangible immoveable property of the value of one hundred rupees and SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 31 of 48 17:00:15 +0530 upwards, or in the case of a reversion or other intangible thing, can be made only by a registered instrument.
In the case of tangible immoveable property of a value less than one hundred rupees, such transfer may be made either by a registered instrument or by delivery of the property. Delivery of tangible immoveable property takes place when the seller places the buyer, or such person as he directs, in possession of the property.
Law on Declaration/Cancellation
46. Section 31(1) of the Specific Relief Act, 1963 5 deals with cancellation of documents. The purpose of cancellation of instruments under the Specific Relief Act of 1963 is to serve justice to the parties who are in a fear of being harmed or are actually being harmed by the other party due to the performance of such instrument/contract. Cancellation of documents/instruments means the nullification of a written document which is proof of a transaction between the parties.
47. Section 34, Specific Relief Act6 provides that a suit against any person denying or interested to deny the plaintiffs' title to the legal character or right to any property can be filed. To obtain the relief of declaration the plaintiff must establish that (1) the plaintiff was at the time of the suit entitled 5 31. When cancellation may be ordered.-- (1) Any person against whom a written instrument is void or voidable, and who has reasonable apprehension that such instrument, if left outstanding may cause him serious injury, may sue to have it adjudged void or voidable; and the court may, in its discretion, so adjudge it and order it to be delivered up and cancelled.
6 34. Discretion of court as to declaration of status or right.--Any person entitled to any legal character, or to any right as to any property, may institute a suit against any person denying, or interested to deny, his title to such character or right, and the court may in its discretion make therein a declaration that he is so entitled, and the plaintiff need not in such suit ask for any further relief:
Provided that no court shall make any such declaration where the plaintiff, being able to seek further relief than a mere declaration of title, omits to do so. SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 32 of 48 17:00:12 +0530 to any legal character or any right to any property (ii) the defendant had denied or was interested in denying the character or the title of the plaintiff,
(iii) the declaration asked for was a declaration that the plaintiff was entitled to a legal character or to a right to property (iv) the plaintiff was not in a position to claim a further relief than a bare declaration of his title. It is a discretionary relief.
48. Hon'ble Supreme Court of India in Deccan Paper Mills Co. Ltd. V Regency Mahavir Properties, Civil Appeal No 5147 of 2016 observed that document though not necessary to be set aside may, if left outstanding, be a source of potential mischief. The jurisdiction under section 39 of the Specific Relief Act, 1877 (which is the pari materia provision to section 31 of the 1963 Act) is a protective or a preventive one. It is to prevent a document to remain as a menace and danger to the party against whom under different circumstances it might have operated.
49. Similarly, in Suhrid Singh V Randhir Singh, (2010) 12 SCC 112, Hon'ble Supreme Court held that where the executant of a deed wants it to be annulled, he has to seek cancellation of the deed. But if a non-executant seeks annulment of a deed, he has to seek a declaration that the deed is invalid, or non est, or illegal or that it is not binding on him. In Deccan Paper Mills Co. Ltd (supra), it was observed that the expression "any person" does not include a third party, but is restricted to a party to the written instrument or any person who can bind such party. It was further observed as under:
"The incongruous result of section 31 of the Specific Relief Act being held to be an in rem provision. When it comes to cancellation of a deed by an executant to the document, such person can approach the Court under section 31, but when it SHILPI M JAIN comes to cancellation of a deed by a non-executant, the non-Digitally signed by SHILPI M JAIN Date: 2026.01.30
CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 33 of 48 17:00:14 +0530 executant must approach the Court under section 34 of the Specific Relief Act, 1963. Cancellation of the very same deed, therefore, by a non-executant would be an action in personam since a suit has to be filed under section 34. However, cancellation of the same deed by an executant of the deed, being under section 31, would somehow convert the suit into a suit being in rem."
50. The plaintiff herein primarily assails the 2014 sale deed on the ground that the entire sale consideration of ₹44,20,000/- was never actually paid, relying upon four un-encashed cheques (Ex. PW1/2 Colly.) i.e. issued in favour of a third party and corroborated in part by the testimony of PW2. However, the sale deed itself (Ex. PW1/1) contains an unequivocal recital of receipt of the full consideration and simultaneous delivery of possession to the transferees. For the purpose of clarification, same is reproduced herein below:
1. That the VENDOR has already received the full and final consideration of Rs. 44,20,000/- (Rupees FORTY FOUR LACS TWENTY THOUSAND ONLY) from the VENDEES as per details given below:-
Vide Ch No. 356709 dt. 26.10.14 Rs. 10,00,000/-
Vide Ch No. 356710 dt. 26.10.14 Rs. 10,00,000/-
Vide Ch No. 356711 dt. 26.10.14 Rs. 10,00,000/-
Vide Ch No. 356713 dt. 26.10.14 Rs. 14,20,000/-
all drawn on ING Vysya Bank Ltd.
Dwarka, ND
2. That the VENDOR doth hereby sell, transfer and convey all his rights, title and interests in the said property unto the VENDEES absolutely and forever.
3. That the vacant physical possession of the aforesaid property has been handed over by the Vendor to the VENDEES at the time of Execution of this Sale Deed.
SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 34 of 48 17:00:10 +0530 (emphasis is mine)
51. In considered opinion of this Court, above recitals in a registered document carry significant evidentiary weight, and the mere non-presentation or non-encashment of cheques does not ipso facto render the deed void ab initio. At best, non-receipt of consideration may give rise to a personal right of recovery or damages, but it does not automatically vitiate the transfer of title effected through a registered instrument, especially where the subsequent transferees (Defendant Nos. 3 and 4) are found to have acted bona fide and with due diligence.
52. Furthermore, the plaintiff's claim of having orally cancelled or rescinded the transaction lacks any legal efficacy. Under Section 54 read with Section 47 of the Registration Act, 1908, provides that once ownership is transferred by a registered deed, any cancellation or rescission of such transfer can only be effected either by a mutual registered cancellation deed or by a decree of a competent court. An oral assertion or unilateral act by the plaintiff cannot undo a registered transfer.
53. Similarly, the release deed executed by Defendant No. 1 in favour of Defendant No. 2 (Ex. PW1/3) is a duly registered document supported by consideration and appears prima facie valid on the record. The plaintiff's prolonged inaction and failure to challenge these transactions contemporaneously has resulted in Defendant Nos. 1 and 2 being permitted to appear as ostensible owners of the property, thereby attracting the protective provisions of Section 41 of the Transfer of Property Act, 1882, which SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 35 of 48 17:00:10 +0530 safeguards bona fide transferees for value without notice of any defect in title.
54. As clarified by the Hon'ble Supreme Court in Suhrid Singh (supra), the nature of relief differs depending on whether the plaintiff is an executant or a non-executant of the impugned deed. In the present case, the plaintiff is not an executant of the impugned release deed of 2014 and Sale Deed of 2015. Hence, the appropriate remedy, if any, would lie under Section 34 by seeking a declaration that those deeds are not binding on him. Nonetheless, the plaintiff has failed to discharge the burden of proving that he continues to hold title or that the subsequent transferees are not protected under Section 41 TPA.
55. In light of the above, the court finds that the chain of title commencing from the 2014 sale deed and culminating in the vesting of ownership in Defendant Nos. 3 and 4 is protected. The plaintiff has not established any continuing title or possessory right in the suit property. Evidence on record, including the testimony of PW3, indicates that the plaintiff never came into possession of the flat after allotment. The recital of possession in the 2014 sale deed, coupled with the defendants' continued occupation, further reinforces that possession lawfully passed to Defendant Nos. 3 and 4.
56. Consequently, the plaintiff fails to make out a prima facie case, SHILPI let alone satisfy the twin requirements of balance of convenience and M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 36 of 48 17:00:11 +0530 irreparable injury necessary for the grant of permanent injunction under Section 38 of the Specific Relief Act, 1963. Likewise, no case is made out for recovery of possession, as the plaintiff has neither title nor prior possession to support such a claim. In view thereof, all these issues are decided against the plaintiff.
ISSUE NO. (i): Whether defendant no.1 had lent Rs.20 lakhs to defendant no.2 Sh. Jai Parkash Saini in order to secure his loan? OPD-1 ISSUE NO. (ix): Whether the plaintiff is entitled to recovery of sum of Rs.
44,20,000/-, as prayed for? OPP
57. Issue No. (i) and Issue No. (ix) are interlinked, as the determination of the former directly impacts the latter hence, taken silumtanously.
58. Issue no. (i) stems from Defendant No. 1's primary defence in his written statement and testimony. He contends that he was not a bona fide purchaser or vendee under the sale deed dated 20.10.2014 (Ex. PW1/1) but was merely included as a co-transferee to secure a pre-existing loan of ₹20,00,000/- that he had advanced to Defendant No. 2 in May 2012. To support this assertion, Defendant No. 1 has tendered documentary evidence, including a promissory note executed by Defendant No. 2 i.e. Ex. D1W1/1, bank statements showing RTGS transfers for the loan amount i.e. Ex.
SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 37 of 48 17:00:14 +0530 D1W1/2 Colly and Ex. D1W2/2, and an acknowledgment of repayment i.e. Ex. D1W1/3. According to him, his involvement in the sale deed was purely collateral for the loan's security, and he did not issue any cheques towards the sale consideration. He further claims that his role concluded upon the execution of the release deed dated 19.12.2014 i.e. Ex. PW1/3 in favour of Defendant No. 2, after the loan was fully repaid, thereby absolving him of any liability for the unpaid purchase money claimed by the plaintiff.
59. Before delving into the merits, it is necessary to examine the propriety of the framing of this issue under Order XIV Rule 1 of the Code of Civil Procedure, 1908 (CPC)7 which, mandates that issues be framed on material propositions of fact or law affirmed by one party and denied by the other, which are essential to the decision of the suit.
60. Thus, in the present matter, Issue No. (i) appears somewhat narrowly and defectively framed, as it focuses exclusively on the subsidiary fact of the prior loan transaction between Defendant Nos. 1 and 2, treating it as a standalone material proposition. However, the core controversy in the suit pertains to the overall validity and enforceability of the sale deed dated 7 1. Framing of issues.--(1) Issues arise when a material proposition of fact or law is affirmed by the one party and denied by the other.
(2) Material propositions arc those propositions of law or fact which a plaintiff must allege in order to show a right to sue or a defendant must allege in order to constitute his defence. (3) Each material proposition affirmed by one party and denied by the other shall form the subject of distinct issue.
(4) Issues are of two kinds:
(a) issues of fact,
(b) issues of law.
(5) At the first hearing of the suit the Court shall, after reading the plaint and the written statements if any, and 1 [after examination under rule 2 of Order X and after hearing the parties or their pleaders], ascertain upon what material propositions of fact or of law the parties are at variance, and shall thereupon proceed to frame and record the issues on which the right decision of the case appears to depend.
SHILPI (6) Nothing is this rule requires the Court to frame and record issued where the defendant at the first hearing M JAIN of the suit makes no defence.
Digitally signed by SHILPI M JAIN Date: 2026.01.30CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 38 of 48 17:00:12 +0530 20.10.2014, the subsequent release deed, and the chain of title leading to Defendant Nos. 3 and 4.
Defendant's role as 'Secured Creditor' or 'Joint Purchaser'
61. In the considered opinion of this Court, the alleged loan is merely an incidental defensive plea raised by Defendant No. 1 to characterize his participation in the sale deed as that of a secured creditor rather than a joint buyer. Framing it in isolation risks misdirecting the inquiry away from the broader issues of title transfer and consideration payment. It is settled law that, inappropriate framing of issues does not automatically invalidate the proceedings or judgment, provided the parties were fully aware of the real points in controversy, led evidence accordingly without suffering prejudice, and the record contains sufficient material to resolve the dispute holistically.
62. Turning to the substantive evaluation, this court has carefully reviewed the evidence and finds Defendant No. 1's defence untenable. The Sale Deed dated 20.10.2014 was executed jointly in favour of Defendant Nos. 1 and 2 as "buyers," with explicit recitals acknowledging receipt of the full sale consideration of ₹44,20,000/- from vendors and handover of possession to them. These recitals create a strong presumption of a genuine sale transaction under Section 54 of the Transfer of Property Act, 1882 (TPA).
SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 39 of 48 17:00:10 +0530
63. Subsequently, Defendant No. 1 executed the release deed dated 19.12.2014, wherein he described himself as the "absolute owner" of his half undivided share in the property and released it to Defendant No. 2 for a stated consideration of ₹22,50,000/-. Critically, neither the sale deed nor the release deed contains any reference whatsoever to the alleged loan arrangement, nor do they indicate that the sale deed was executed merely as security for the loan. The promissory note dated 22.05.2012 (Ex. D1W1/1) relied upon by Defendant No. 1 also makes no mention of the property or the sale deed serving as collateral. While the existence of the loan itself may be credible based on the bank transfers and repayment acknowledgment, it does not retroactively alter the legal character of the registered sale deed. Defendant No. 1's active participation as a co-executant in a document that portrays him as a joint purchaser, without any contemporaneous stipulation limiting his role to that of a security holder, precludes him from now repudiating the transaction's nature.
64. In essence, any internal arrangement between Defendant Nos. 1 and 2 regarding the loan cannot prejudice the plaintiff's rights as the original vendor, especially where the registered instruments unequivocally depict a standard sale. Accordingly, Issue No. (i) is decided against Defendant No. 1 and in favour of the plaintiff, holding that the loan, even if advanced, does not transform the sale deed into a security document or exempt Defendant No. 1 from liabilities arising from the unpaid consideration.
Maintainability of Alternative Prayer SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 40 of 48 17:00:13 +0530
65. Now, this court shall proceed with Issue No. (ix) wherein plaintiff made alternative prayer. This claim is founded on the assertion that the sale consideration recited in the sale deed dated 20.10.2014 was never actually paid or received. In support, the plaintiff has deposed in both his affidavit and oral testimony that no portion of the ₹44,20,000/- was ever received, leading him to purportedly orally cancel the transaction shortly after registration. He further states that four post-dated cheques aggregating the full amount were handed over by Defendant No. 2 during the transaction, but he was explicitly instructed by both Defendant Nos. 1 and 2 not to present them for encashment immediately after the deed's registration on 25.10.2014. Despite this, the plaintiff took no formal steps for recovery or cancellation until instituting the present suit in 2017.
66. The plaintiff's evidence is bolstered by the testimony of PW2, a bank official from Kotak Mahindra Bank, who has confirmed through certified bank statements (Ex. PW2/1 Colly.) and a certificate under Section 65B of the Indian Evidence Act, 1872 (Ex. PW2/2 Colly and Ex. PW2/3), that none of the four cheques were ever presented for encashment and, consequently, never cleared or dishonored for insufficient funds. This uncontroverted documentary proof establishes non-payment beyond reasonable doubt.
67. Notably, Defendant No. 2, who issued the cheques from his account and stands as the primary obligor, has remained ex-parte since 21.04.2017 and has not filed any written statement or led evidence to rebut SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 41 of 48 17:00:12 +0530 the plaintiff's claims. Defendant Nos. 3 and 4, being subsequent purchasers, have opposed the suit but have no direct interest or liability in this alternative monetary relief, which is confined to Defendant Nos. 1 and 2.
Delhi State Newspaper Employees Federation CGHS Ltd. is necessary party?
68. A key preliminary objection interposed by the defendants is that the cheques were drawn in favour of the Delhi State Newspaper Employees Federation CGHS Ltd. (the housing society where the suit property is located) rather than directly to the plaintiff, thereby necessitating the society's joinder as a party to the suit.
69. It is well settled law that, no suit shall be defeated by reason of misjoinder or non-joinder of parties, and the Court may in every suit deal with the matter in controversy so far as regards the rights and interests of the parties actually before it.8 A `necessary party' is a person who ought to have been joined as a party and in whose absence no effective decree could be passed at all by the Court. If a `necessary party' is not impleaded, the suit itself is liable to be dismissed. A `proper party' is a party who, though not a necessary party, is a person whose presence would enable the court to completely, effectively and adequately adjudicate upon all matters in disputes in the suit, though he need not be a person in favour of or against whom the decree is to be made. If a person is not found to be a proper or necessary party, the court has no jurisdiction to implead him, against the wishes of the plaintiff. The fact that a person is likely to secure a right/interest in a suit property, after the suit is decided against the plaintiff, will not make such SHILPI 8 Order I Rule 9 CPC M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 42 of 48 17:00:09 +0530 person a necessary party or a proper party to the suit for specific performance.9
70. Hon'ble Supreme Court of India in the matter of Mumbai International Airport Private Limited v. Regency Convention Centre and Hotels Private Limited and Others10 held as follows:
"8. The general rule in regard to impleadment of parties is that the plaintiff in a suit, being dominus litis, may choose the persons against whom he wishes to litigate and cannot be compelled to sue a person against whom he does not seek any relief. Consequently, a person who is not a party has no right to be impleaded against the wishes of the plaintiff. But this general rule is subject to the provisions of Order I Rule 10(2) of Code of Civil Procedure (`Code' for short), which provides for impleadment of proper or necessary parties. The said sub-rule is extracted below:
Court may strike out or add parties. (2) The Court may at any stage of the proceedings, either upon or without the application of either party, and on such terms as may appear to the Court to be just, order that the name of any party improperly joined, whether as plaintiff or defendant, be struck out, and that the name of any person who ought to have been joined, whether as plaintiff or defendant, or whose presence before the Court may be necessary in order to enable the Court effectually and completely to adjudicate upon and settle all the questions involved in the suit, be added."
71. In the instant case, the society is neither a necessary nor a proper party for the alternative relief of monetary recovery. The plaintiff executed the sale deed as the sole vendor, and the consideration was contractually due 9 Mumbai International Airport Private Limited v. Regency Convention Centre and Hotels Private Limited and Others (2010) 7 SCC 417 SHILPI 10 (2010) 7 SCC 417 M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 43 of 48 17:00:15 +0530 to him. The cheques, though payable to the society, were ostensibly intended to clear society dues as a facilitative part of the sale transaction, with the balance accruing to the plaintiff. They were physically handed over to the plaintiff for onward transmission.
72. PW3, the society's administrator, has deposed that the society holds no possession of the flat post its freehold conversion and has no record of outstanding dues against the plaintiff. The non-encashment stems directly from instructions issued by Defendant Nos. 1 and 2, not from any act or omission by the society. Thus, the society's absence causes no prejudice to the defendants, and an effective decree for recovery can be passed without impleading it, in line with the principles laid down in the Mumbai International Airport Pvt. Ltd. (supra).
73. On the substantive merits, while the primary reliefs for cancellation/declaration of deeds sought by the plaintiff have been denied in earlier issues primarily due to the protection afforded to Defendant Nos. 3 and 4 as bona fide purchasers for value without notice under Section 41 TPA the alternative claim for recovery of unpaid consideration stands on a distinct footing and is maintainable. Even after registration under Section 54 TPA vests title in the buyer, the seller retains the right to sue for the balance consideration. The recital of receipt in the sale deed, though prima facie evidence, is rebuttable under Proviso (1) to Section 95 of Bhartiya Sakshya Adhiniyam, 2023, particularly where non-payment is proved through cogent evidence, as has been done here via bank records and unchallenged SHILPI M JAIN testimony.
Digitally signed by SHILPI M JAIN Date: 2026.01.30CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 44 of 48 17:00:13 +0530 Regarding joint and several liability
74. Regarding liability, Defendant No. 2's role as the cheque issuer and the primary beneficiary of the transaction who subsequently sold the property to Defendant Nos. 3 and 4 for ₹48,00,000/- renders him unequivocally liable for the full amount. As for Defendant No. 1, his inclusion as a co-vendee in the sale deed, active involvement in negotiations, and participation in issuing post-registration instructions not to encash the cheques establish joint inducement and shared responsibility. Under Section 43 of the Indian Contract Act, 187211, when two or more persons make a joint promise, the promisee may compel any one or more of them to perform the whole promise, making liability joint and several. Defendant No. 1's execution of the release deed for ₹22,50,000/- further weakens his defence of being a mere creditor, as it indicates he derived tangible benefit from the transaction. The ex-parte status of Defendant No. 2 only strengthens the case against him, while Defendant No. 1's evidence fails to exonerate him from shared accountability. Therefore, Issue no. (ix) is decided in favour of plain- tiff and against Defendant nos. 1 and 2.
CONCLUSION 11 43.Any one of joint promisors may be compelled to perform.--When two or more persons make a joint promise, the promisee may, in the absence of express agreement to the contrary, compel any 1 [one or more] of such joint promisors to perform the whole of the promise. Each promisor may compel contribution.--Each of two or more joint promisors may compel every other joint promisor to contribute equally with himself to the performance of the promise, unless a contrary intention appears from the contract.
Sharing of loss by default in contribution.--If any one of two or more joint promisors makes default in such contribution, the remaining joint promisors must bear the loss arising from such default in equal shares.
Explanation.--Nothing in this section shall prevent a surety from recovering from his principal, SHILPI payments made by the surety on behalf of the principal, or entitle the principal to recover anything from M JAIN the surety on account of payments made by the principal.
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75. After careful evaluation of the entire pleadings, oral and documentary evidence adduced by both sides, rival contentions heard on final arguments, and the binding judicial precedents, this Court arrives at the following conclusions:
a) The plaintiff has discharged the burden of proving that the full sale consideration of ₹44,20,000/- recited in the registered Sale Deed dated 20.10.2014 (Ex.PW1/1) was never in fact paid or received by him. The four cheques issued by defendant no.2 were admittedly never presented for encashment i.e. a position conclusively established by the unimpeached testimony of bank official (PW-2) and the certified bank records produced therewith;
b) Notwithstanding the above, the primary reliefs of cancellation of the Sale Deed dated 20.10.2014, declaration of nullity of the Release Deed dated 19.12.2014 and the subsequent Sale Deed dated 20.03.2015, declaration of plaintiff's exclusive ownership, permanent injunction restraining alienation, and recovery of possession are not grantable against defendant nos. 3 & 4. Defendant nos. 3 & 4 qualify as bona fide purchasers for valuable consideration of ₹48,00,000/-
paid through RTGS, without notice of any defect in title, and after taking reasonable care to verify the chain of registered title documents. The plaintiff's own conduct in executing the 2014 sale deed with unequivocal recitals of full payment and possession, followed by extraordinary inaction from October 2014 till January 2017, created an ostensible ownership in defendant no. 1 and 2, thereby attracting statutory protection under Section 41 of the Transfer of Property Act, 1882 in favour of defendant nos. 3 & 4; SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 46 of 48 17:00:11 +0530
c) Defendant no. 1 remains jointly and severally liable along with defendant no. 2 for the unpaid sale consideration of ₹44,20,000/-. Although defendant no.1 has sought to portray his role in the 20.10.2014 transaction as that of a mere secured creditor, the registered sale deed unequivocally names him as a joint vendee/purchaser and contains positive recitals of receipt of consideration and delivery of possession to both defendant nos. 1 & 2. No contemporaneous document limits his role to that of a security holder. Further, his active participation in the execution of the sale deed, followed by the execution of the release deed dated 19.12.2014 for a stated consideration of ₹22,50,000/-, establish his direct involvement in and benefit from the transaction. These circumstances make him a joint promisor under Section 43 of the Indian Contract Act, 1872, and preclude him from escaping liability for the unpaid consideration merely by characterizing his participation as collateral security after the event.
d) The alternative monetary relief claimed in the plaint is therefore maintainable and decreed against defendant nos. 1 & 2 jointly and severally. The housing society not being a necessary or proper party for adjudication of this contractual/monetary claim, non-joinder does not vitiate the relief.
76. In the result, the suit is partly decreed in the following terms:
i) Defendant nos. 1 & 2 shall jointly and severally pay to the plaintiff a sum of ₹44,20,000/- (Rupees Forty Four Lakhs Twenty Thousand only) together with simple interest @ 6% per annum on decretal amount from the SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 47 of 48 17:00:13 +0530 date of execution of the Sale Deed i.e. 20.10.2014 till the date of institution of the suit i.e. 07.03.2017, and further simple interest @ 6% per annum on decretal amount from the date of filing of the suit till realization.
ii) The suit against defendant nos. 3 & 4 stands dismissed.
(iii) All other reliefs cancellation/declaration of the impugned documents, declaration of plaintiff's exclusive ownership, permanent injunction and recovery of possession are declined.
(iv) Parties shall bear their own costs.
77. Decree sheet be prepared accordingly.
78. File be consigned to the record room after due compliance.
Announced in open court on 30.01.2026 (SHILPI M JAIN) District Judge-05, South West District Dwarka Courts, New Delhi SHILPI M JAIN Digitally signed by SHILPI M JAIN Date: 2026.01.30 CS DJ ADJ 250/17 Shiv Kumar Sharma Vs. Ramesh Chander & Ors. Page No. 48 of 48 17:00:11 +0530