Conditions To Invoke S. 53A Transfer Of Property Act : Supreme Court Explains

The Supreme Court recently observed that the transferee cannot claim protection under Section 53-A of the Transfer of Property Act, 1882 (“TPA”) if he fails to prove the execution of a sale agreement based on which possession was claimed.

The Court also explained the conditions to invoke Section 53A.

The bench comprising Justice J.B. Pardiwala and Justice R. Mahadevan was hearing the plea filed against the Karnataka High Court's decision that approved the First Appellate Court and Trial Court's decision decreeing the suit for the declaration of title and recovery of possession in the plaintiff's-Respondent favor.

The Petitioners-Defendants claimed possession of the immovable property based on a sale agreement for 2 Guntas of land allegedly executed in their favor by the Respondent-Plaintiff. When the Respondent-Plaintiff filed a suit seeking a declaration of title and recovery of possession, the Petitioners-Defendants invoked protection under Section 53A of the Transfer of Property Act (TPA), asserting their rights as prospective transferees in part-performance of the contract.

The Petitioners contended that the Respondent had executed a Sale Agreement dated 25.11.1968, granting them possession and enjoyment of the property. As such, they argued that Section 53A of the TPA barred the Respondent from enforcing the contract against them.

The Trial Court ruled in favor of the Respondent-Plaintiff, decreeing the suit. This decision was upheld by both the First Appellate Court and the High Court.

The High Court noted that “when the defendant has failed to prove that plaintiff has executed the Sale Agreement dated 25.11.1968 agreeing to sell 2 gunta out of survey No.24/9 and he came in possession and occupation of suit schedule property by virtue of the same, question of providing protection under Section 53A of the T.P. Act does not arise.”

Section 53A of TPA acts as a shield for the prospective transferee who is holding possession of the immovable property under a contract of sale, that is not formally executed (not registered). The provision puts an obligation on the transferor to not enforce the contract against the transferee when the transferee has acted in accordance with the written agreement.

“Section 53-A of the Transfer of Property Act was inserted partly to set at rest the conflict of views in this country, but principally for the protection of ignorant transferees who take possession or spend money in improvements relying on documents which are ineffective as transfers or on contracts which cannot be proved for want of registration. The effect of this section, is to relax the strict provisions of the Transfer of Property Act and the Registration Act in favour of transferees in order to allow the defence of part performance to be established.”, the court observed.

According to the petitioners, the respondents (original plaintiffs) may be the lawful owners of the suit scheduled property but they executed a sale agreement dated 25-11-1968 in their favour agreeing to sell 2 guntas of land out of survey No.24/9 for total consideration of Rs.850/- and since then the petitioners – herein came to be in possession and enjoyment of the same.

The question that fell for the Court's consideration was whether the petitioner-defendant could claim part-performance of the contract under Section 53A of TPA.

Affirming the High Court's decision, the court observed that the failure of the petitioner to show that the respondent had executed a sale agreement in its favor would not entitle him to claim part performance of the contract.

According to the Court, the protection of a prospective purchaser/transferee of his possession of the property involved under Section 53A TPA is available subject to the following prerequisites:

“(a) There is a contract in writing by the transferor for transfer for consideration of any immovable property signed by him or on his behalf, from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty;

(b) The transferee has, in part-performance of the contract, taken possession of the property or any part thereof, or the transferee, being already in possession, continues in possession in part-performance of the contract;

(c) The transferee has done some act in furtherance of the contract and has performed or is willing to perform his part of the contract.”

The Court declined to extend the benefit of Section 53A of the TPA to the petitioners as they failed to meet its prerequisites. The alleged sale agreement could not be proven, and the petitioners' possession lacked legal validity under the purported agreement.

Hence, the petition was dismissed.

Appearance:

For Petitioner(s) Mr. Anand Sanjay M. Nuli, Sr. Adv. Mr. Akash Kukreja, Adv. Mrs. Samina S., Adv. Mr. Abhishekh Singh, Adv. For M/s.Nuli & Nuli, AOR

For Respondent(s) None

Case Title: GIRIYAPPA & ANR. VERSUS KAMALAMMA & ORS.

Citation : 2024 LiveLaw (SC) 1038

Click here to read/download the order