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Judgment Summary — Bennett, J.

Factual and Procedural Background

The appeal arises from a decision of the Additional Subordinate Judge, Cuttack, which reversed the judgment of the Munsif of the 1st Court, Cuttack. The respondent instituted a suit under Order 21, Rule 103 of the Civil Procedure Code seeking a declaration that a decree obtained by the appellant in Original Suit No. 242 of 1930 was not binding on her and for a permanent injunction restraining the appellant from taking delivery of possession of the disputed property in execution of that decree.

The factual chronology as set out in the opinion is as follows:

  • On 5-12-1927, Alekh Sahu agreed to sell the disputed property to the appellant.
  • On 20-6-1930, Alekh Sahu entered into a second agreement to sell the same property to the respondent.
  • On 16-7-1930, Alekh Sahu executed a deed of sale in favour of the respondent, who thereafter entered into possession and whose name appears in the Current Settlement Record of Rights.
  • On the same date, 16-7-1930, but after the respondent's deed was executed, the appellant instituted O.S. No. 242 of 1930 against Alekh Sahu claiming specific performance of the 5-12-1927 contract. The appellant admitted (as D.W.3) that when he instituted O.S. No. 242 of 1930 he was aware of the prior execution on that day of the deed of sale to the respondent, but he did not implead the respondent in that suit.
  • On 19-7-1930, three days after the appellant's suit was instituted, the deed of sale to the respondent was duly registered.
  • The appellant obtained a decree for specific performance in O.S. No. 242 of 1930 and a registered kebala was executed in his favour by the Munsif. On application for delivery of possession, the respondent intervened under Section 151 CPC and prayed for refusal of delivery; that claim was dismissed on the ground that the deed to the respondent had been executed pendente lite. The respondent then commenced the present suit under O.21, R.103 CPC.

Legal Issues Presented

  1. Whether the sale to the respondent was pendente lite because registration occurred three days after institution of O.S. No. 242 of 1930, and if so, whether Section 52 (doctrine of lis pendens) of the Transfer of Property Act prevents the respondent's title from prevailing.
  2. How Section 47 of the Registration Act, 1908 (that a registered document operates from the time it would have operated had registration not been required), interacts with Section 54 of the Transfer of Property Act and the doctrine of lis pendens under Section 52.
  3. Whether Section 47 of the Registration Act operates only inter partes (between the parties) or also affects the rights of third parties who take with notice.
  4. Whether Section 91 of the Trusts Act, 1882 can be relied upon to treat the subsequent purchaser (respondent) as holding the property in trust for the appellant such that the appellant could obtain possession without first obtaining specific performance against the vendor.
  5. Whether a decree for specific performance obtained against the vendor (and a subsequent purchaser under that decree) relates back so as to defeat intermediate conveyances made to third parties prior to institution of the suit.

Arguments of the Parties

Appellant's Arguments

  • The appellant (through Mr. B.K. Pal) contended that the deed of sale to the respondent was pendente lite because it was registered on 19-7-1930, three days after the appellant instituted O.S. No. 242 of 1930 (16-7-1930). He argued that, since Section 54 of the Transfer of Property Act requires registration for sale of immovable property, the date of transfer for the purposes of Section 52 (lis pendens) must be the date of registration.
  • He further argued that Section 47 of the Registration Act operates only as between the parties to the deed and does not affect the rights of third parties, citing decisions such as A.I.R. 1936 Cal. 17, A.I.R. 1941 Cal. 784 and A.I.R. 1934 Rang. 216.
  • He relied on Section 91 of the Trusts Act, 1882 to contend that the respondent must be deemed to hold the disputed property in trust for the appellant, allowing the appellant to enforce his rights against the respondent without first obtaining a decree for specific performance against the vendor.

The opinion does not contain a detailed account of the respondent's separate legal arguments beyond the factual steps that the respondent intervened under Section 151 CPC asking that delivery of possession be refused and subsequently commenced the present suit under O.21, R.103 CPC.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
8 P.L.T. 327 (Privy Council) Held that a deed of gift of immovable property, once delivered and accepted, is not suspended until registration; registration is a necessary solemnity for enforcement but does not prevent the instrument operating from its execution date. Used to support the proposition that Section 47 of the Registration Act causes a registered transfer to relate back to the date of execution, and that registration does not make the effective date the registration date for lis pendens purposes.
19 P.L.T. 383 (Division Bench of this Court) Applied the Privy Council decision to hold a deed executed before attachment took effect was not defeated by the attachment and that when registered the deed took effect from the date of execution. Relied on as domestic authority corroborating that registration relates back to execution date and does not allow intervening events (attachment or similar) to defeat the deed.
A.I.R. 1936 Cal. 17; A.I.R. 1941 Cal. 784; A.I.R. 1934 Rang. 216 These decisions were cited by the appellant to argue limits of Section 47 of the Registration Act (that it operates only inter partes). The court observed that insofar as these decisions turn on other statutory wordings they are not helpful; and insofar as they interpret Section 47 they appear inconsistent with the Privy Council (8 P.L.T. 327) and 19 P.L.T. 383 decisions.
45 Mad. 641 (Judicial Committee) Demonstrates that the only remedy of a person contracting with a vendor of immovable property is a suit for specific performance (i.e., remedy against vendor is specific performance). Applied to show that Section 91 of the Trusts Act cannot enlarge the remedy available to a person contracting with the vendor beyond specific performance; a subsequent purchaser who buys with notice assumes vendor's obligations but not greater ones.
10 Pat. 851 (Judicial Committee) Shows that the trust arising under Section 91 of the Trusts Act is by operation of law and is not a trust for a specific purpose within the meaning of Section 10 of the Limitation Act, 1908. Used to support the conclusion that once the remedy by specific performance is barred by limitation (Article 113, Schedule 1 to the Limitation Act, 1908), the person entitled under the prior contract has no further remedy against a subsequent transferee.
34 C.L.J. 79 (dictum of Mookerjee, J.) Contains a dictum suggesting that when a suit for specific performance ends in a final decree transferring title, that title dates back to the date of the agreement and the Court will not permit its decree to be rendered nugatory by intermediate conveyances. The court expressed doubt that Mookerjee, J. intended to extend the doctrine of lis pendens beyond the actual pendency of the suit; the opinion treats the dictum as unnecessary to the decision in that case and incompatible with the ordinary meaning of lis pendens and Section 52.
17 C.L.J. 427 Relied upon in 34 C.L.J. 79 for the proposition regarding the timing of subsequent purchases vis-à-vis suits for specific performance. Referenced by the court as part of the context in which the dictum in 34 C.L.J. 79 was stated; the court observed the subsequent purchase in the cited authorities occurred after the date of the suit, so no extension of lis pendens was required.
(1857) 1 De G. & J. 566 (Turner L.J.) English statement of the doctrine of lis pendens restricting its operation to the period of the lis. Referred to as the English authority on which Section 52 of the Transfer of Property Act is based; used to support the proposition that lis pendens is limited to the pendency of the suit.

Court's Reasoning and Analysis

The court's reasoning proceeds in a sequence that addresses the appellant's specific contentions and applies statutory provisions and cited authorities without extending beyond what the opinion states:

  1. On the question whether the effective date of the respondent's transfer was the registration date (which would make the transfer pendente lite), the court observed that Section 54 of the Transfer of Property Act requires registration for sale of immovable property but that Section 47 of the Registration Act provides that "A registered document shall operate from the time from which it would have commenced to operate if no registration thereof had been required or made, and not from the time of its registration." The court reads these provisions together to conclude that a transfer by registered instrument, once effected, relates back to the date of execution (or other conventional date), not to the date of registration.
  2. The court relied on the Privy Council decision reported in 8 P.L.T. 327 and the Division Bench decision in 19 P.L.T. 383 to support this reading. The Privy Council decision was summarized as holding that registration is a necessary solemnity but does not suspend the operation of a deed that has already been delivered and accepted, and registration does not depend on the donor's consent. The domestic Division Bench decision was said to apply the same principle to deeds affected by attachment and to hold that when registered the deed takes effect from its execution date.
  3. Addressing the appellant's contention that Section 47 operates only between the parties and not as against third parties, the court considered precedent cited by the appellant (some Calcutta and Rangoon decisions). The court held that where those decisions turned on other statutory provisions they were inapplicable; where they purported to interpret Section 47, they were, with respect, inconsistent with the Privy Council and the Division Bench authority which directly considered the effect of Section 47 on third parties.
  4. On the reliance placed by the appellant on Section 91 of the Trusts Act, 1882 (arguing the respondent holds in trust and can be compelled to deliver possession), the court analysed the nature and limits of that trust. The court observed that Section 27(b) of the Specific Relief Act makes the vendor a trustee for the person contracting with him to the extent necessary to give effect to the contract, but that the only remedy against the vendor is a suit for specific performance (as shown by the Judicial Committee decision in 45 Mad. 641). The court concluded that Section 91 likewise creates a trust by operation of law but only to the extent necessary to give effect to enforcement of the contract — i.e., by means of specific performance.
  5. The court rejected the notion that Section 91 permits the appellant to obtain possession directly from a subsequent purchaser with notice without first obtaining specific performance against the vendor. It held that allowing such a remedy would improperly extend the doctrine of lis pendens beyond the actual pendency of the suit, a result inconsistent with Section 52 of the Transfer of Property Act and with English authorities on which it is based (Turner L.J.). In particular, the court noted that a decree for specific performance merges the original contract into the decree, and a decree obtained in a suit to which a subsequent transferee was not a party cannot be said simply to enforce the original contract against that transferee.
  6. Finally, having addressed these contentions, the court concluded that the appellant's arguments did not succeed and that the appeal should be dismissed, awarding costs to the respondent as indicated by Bennett, J.'s statement "I would dismiss the appeal with costs." Beevor, J. agreed and the appeal was dismissed.

Holding and Implications

APPEAL DISMISSED.

Holding (core ruling): The court dismissed the appellant's appeal and ordered costs against the appellant. The court held that Section 47 of the Registration Act must be read with Section 54 of the Transfer of Property Act so that a registered transfer operates from the date it would have operated if registration had not been required (i.e., effectively from the date of execution), and that Section 47's effect cannot be narrowly confined to operate only inter partes where it would conflict with the Privy Council authority and the Division Bench decision cited.

Implications:

  • Direct effect on the parties: The appellant's challenge to the binding effect of the decree vis-à-vis the respondent failed; the appeal was dismissed and costs were ordered against the appellant.
  • Remedies and limitations: The judgment underscores that a purchaser with notice of an earlier agreement does not, by virtue of Section 91 of the Trusts Act alone, acquire greater obligations than the vendor and cannot be compelled to hand over possession except pursuant to the established remedies (notably, a suit for specific performance against the vendor). The court emphasised that the doctrine of lis pendens (Section 52 T.P. Act) is confined to the period during which the lis is actually pending and cannot be extended back to the date of agreement so as to defeat intermediate transactions unless the law expressly so provides.
  • Precedential effect: The opinion relies on existing decisions (including Privy Council and Division Bench authorities) to resolve the questions and does not purport to lay down a novel principle of law beyond applying those authorities. The court indicated that certain local decisions cited by the appellant were inconsistent with the higher authorities relied upon here.

This summary is drawn exclusively from the text of the provided opinion and does not add or infer facts or reasoning beyond what is contained therein.

    Sadei Sahu v. Chandramani Dei

    Bennett, J.:— This is an appeal from a decision of the Additional Subordinate Judge, Cuttack, reversing the judgment of the Munsif of the 1st Court, Cuttack, in a suit instituted by the respondent under O. 21, R. 103 of the CPC, for a declaration that the decree obtained by the appellant in original Suit No. 242 of 1930 of the latter Court is not binding upon her and for a permanent injunction against the appellant restraining him from taking delivery of possession of the disputed property in execution of the said decree.

    2. The facts of the case are as follows. On 5-12-1927, one Alekh Sahu agreed to sell the disputed property to the appellant. On 20-6-1930, Alekh Sahu entered into a second agreement under which he contracted to sell the disputed property to the respondent and on 16-7-1930, he executed a deed of sale thereof to the respondent who thereafter entered into possession and her name appears in the Current Settlement Record of Rights.

    3. There are concurrent findings of fact of the two Courts below, which were not disputed before us, that the respondent at the date of her purchase had notice of the prior sale to the appellant. On the same day, 16-7-1930, but subsequent to the actual execution of the above-mentioned deed of sale to the respondent, the appellant instituted O.S No. 242 of 1930 against Alekh Sahu claiming specific performance of the contract of sale of 5-12-1927. In his evidence the appellant as D.W 3, admitted that on 16-7-1930, when he instituted O.S No. 242 of 1930, he was aware of the prior execution on that day of the deed of sale to the respondent. He did not, however, see fit to implead the respondent in that suit. On 19-7-1930, three days after the institution by the appellant of O.S No. 242 of 1930, the deed of sale to the respondent was duly registered. The appellant's claim in O.S No. 242 of 1930 against Alekh Sahu for specific performance of the agreement of 5-12-1927, was duly decreed and a registered kebala was duly executed in his favour by the Munsif of the 1st Court. On his application for delivery of possession, the respondent intervened under Section 151 of the CPC, and prayed that delivery of possession be refused. His claim was dismissed on the ground that the deed of sale to him of 16-7-1930, was executed pendente lite. He therefore commenced the present suit.

    4. The first point taken by Mr. B.K Pal on behalf of the appellant was that the sale to the respondent was pendente lite in that the deed of sale was not registered until three days after the institution of suit No. 242 of 1930. He argued that since Section 54 of the Transfer of Property Act, 1882, provides that a sale of tangible immovable property can only be made by a registered instrument, it follows as of course that the date of the transfer for the purposes of S. 52 of that Act, which enunciates the doctrine of lis pendens, must be the date of registration. This argument however entirely ignores Section 47 of the Registration Act, 1908, which itself repeats the corresponding provision of the earlier Registration Acts of 1864, 1866, 1871 and 1877 and which provides as follows:

    “A registered document shall operate from the time from which it would have commenced to operate if no registration thereof had been required or made, and not from the time of its registration.”

    5. This section can only be read together with Section 54 of the Transfer of Property Act, 1882, on the basis that the transfer by registered instrument under Section 54 of the Transfer of Property Act, 1882, once effected, relates back to the date of execution or other conventional date. That this is so, is, in my opinion, clear from the decision of the Judicial Committee in 8 P.L.T 3271 and from the application of that decision made by a Division Bench of this Court in 19 P.L.T 383.2 In the case in the Privy Council, it was held that where a Hindu governed by the Mitakshara School executed a deed of gift and made it over to the donee, who accepted the gift, but prior to registration the donor adopted a son, the adoption did not render the gift inoperative, although the gift had not been registered before adoption. The ratio decidendi of their Lordships' decision was stated by Lord Salvesen as follows:

    “They (their Lordships) are unable to see how the provisions of Section 123 of the Transfer of Property Act, can be reconciled with Section 47 of the Registration Act, except upon the view that, while registration is a necessary solemnity in order to the enforcement of a gift of immovable property, it does not suspend the gift until registration actually takes place. When the instrument of gift hag been handed by the donor to the donee and accepted by him, the former has done everything in his power to complete the donation and to make it effective. Registration does not depend upon his consent, but is the act of an officer appointed by law for the purpose, who, if the deed is executed by or on behalf of the donor and is attested by at least two witnesses, must register it if it is presented by a person having the necessary interest within the prescribed period. Neither death nor the express revocation by the donor, is a ground for refusing registration, if the other conditions are complied with.”

    6. The provisions of Section 123 of the Transfer of Property Act, 1882, which govern the mode of a valid transfer of immovable property by way of gift, are as categorical and mandatory in their terms as are those of S. 54 of that Act and I am of opinion that they cannot be distinguished in their relation to Section 47 of the Registration Act. That this is so, follows clearly from the decision of this Court above referred to in 19 P.L.T 383 where in reliance upon the decision of the Judicial Committee above quoted, it was held that where a deed relating to certain properties requiring registration was executed and before it could be registered the properties were attached, the attachment did not prevail against the deed or prevent registration thereof and that when registered the deed took effect from the date of its execution.

    7. Mr. B.K Pal argued strenuously that Section 47 of the Registration Act, 1908, operated only as between the parties to the deed and did not affect the rights of third parties and he referred to the decisions in A.I.R 1936 Cal. 17,3 A.I.R 1941 Cal. 784 and A.I.R 1934 Rang. 216.5 In so far as those decisions turn upon the wording of some other statutory provisions, such as Section 54 of the Provincial Insolvency Act, 1920, and s. 26F, Ben. Ten. Amendment Act, 1938, they are no guide to the present question, but in so far as they purport to interpret Section 47 of the Registration Act, 1908, they appear to me, if I may say so respectfully, to be inconsistent with the decision of the Privy Council in 8 P.L.T 327 and of this Court in 19 P.L.T 383, above referred to. In both these cases the effect of S. 47 upon the right of a third party was directly in issue and the immediate subject of the decision.

    8. Mr. B.K Pal next contended that he was entitled to rely upon Section 91 of the Trusts Act, 1882, and that thereunder the respondent must be deemed to hold the property in dispute in trust for the appellant. In so far as this contention, in the circumstances of this case, can be said to aid the appellant, it must mean that by virtue of Section 91 of the Trusts Act, 1882, a person to whom the owner has contracted to sell immovable property is entitled to sue a subsequent transferee thereof with notice for possession of the immovable property without claiming or first obtaining a decree for specific performance of the contract, but that proposition refutes itself. Under Section 27(b) of the Specific Relief Act, the vendor of immovable property is just as much a trustee for the person with whom he contracts for the sale thereof as is a subsequent purchaser thereof under Section 91 of the Trusts Act, 1882, but, as the decision of the Judicial Committee in 45 Mad. 6416 makes abundantly apparent, the only remedy of such a person against a vendor is a suit for specific performance. By purchasing with notice of the prior agreement, the subsequent purchaser assumed all the obligations of the vendor, but he does not assume any greater obligation. The words ‘to the extent necessary to give effect to the contract’ in Section 91 of the Trusts Act, 1882, mean, therefore, to the extent necessary to give effect to the only means that exist of enforcing the contract, namely, a suit for specific performance. The trust created by Section 91 of the Trusts Act, 1882, arises by operation of law and, as the decision of the Judicial Committee in 10 Pat. 8517 shows, is not a trust for a specific purpose within the meaning of Section 10 of the Limitation Act, 1908. Once, therefore, the remedy by way of specific performance is barred under Article 113 of sch. 1 to the Limitation Act, 1908, the person to whom the vendor first contracted to sell the property has no further or other remedy. Mr. B.K Pal sought to distinguish the case where such a person has obtained a decree for specific performance against the vendor and cited the dictum of Mookerjee, J. in 34 C.L.J 79,8 where that very learned Judge appears to have laid down a general proposition of law to the effect that when a suit for specific performance is ended by a final decree transferring the title, that title dates back to the date of the agreement on which the suit is based and that the Court will not permit its decree to be rendered nugatory by intermediate conveyances. It is to be remarked that if that proposition is accepted at its face value, it renders Section 52 of the Transfer of Property Act, 1882, largely, and Section 91 of the Trusts Act, 1882, entirely redundant, since it extends the doctrine of lis pendens in such a case beyond the actual pendency of the suit to the period between the date of the agreement on which a suit for specific performance is based and the date of the institution of the suit. It is only by some such extension of the doctrine of lis pendens that the suggested distinction can be maintained, because the suit and decree for specific performance against the vendor is res alios inter acta qua the subsequent purchaser and cannot otherwise affect his rights, but, the doctrine never has and, within the ordinary meaning of the expression lis pendens, never could be so extended. Both in the law of India as set out in Section 52 of the Transfer of Property Act, 1882, and in the law of England, upon which the section is based, as enunciated by Turner L.J, in (1857) 1 De. G. &, J. 566,9 the operation of the doctrine is restricted to the period of the lis. Nor can it be suggested that having obtained the decree for specific performance against the vendor, the purchaser under the decree in instituting a suit for possession against the original subsequent purchaser on the basis of the decree is doing no more than enforcing his original contract for the enforcement of which the subsequent purchaser holds the property in trust. The original con-tract with the vendor has merged in the decree and in such a suit it is not his original contract which the purchaser under the decree is seeking to enforce but the decree itself which he has obtained in a suit to which the subsequent transferee was not a party. The point is really elemental and looking at the actual decision in 34 C.L.J 79 I am very doubtful if Mookerjee, J. really intended to do more than enunciate the ordinary doctrine of lis pendens, because it was not necessary for the purposes of that case in any way to extend the doctrine, the subsequent purchase there in question being clearly effected after the date of the suit for specific performance, as was also the case in 17 C.L.J 42710 on which the learned Judge specifically relied for the proposition he enunciated.

    9. For the above reasons, I would dismiss the appeal with costs.

    Beevor, J.:— I agree.

    D.H

    10. Appeal dismissed.

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    Sadei Sahu v. Chandramani Dei
    (Feb 17, 1947)