"Things gained through unjust fraud are never secure." ~ Sophocles
Introduction: Facts Of The Case
For the reason of simplicity and clarity, there will be 2 parties, "A" for
plaintiff and "B" for defendant
In the present situation, Party "A" are the owners of 0 H 42 R land out of Gut
No. 9 and 0 H 34 R land out of the same gut number within the limits of Junnar
city in the Pune district of the Indian state of Maharashtra.
It is expressed that, the party "A" needed money in the year 2018 and they had
requested the party "B" to give loan amount of Rs. 60,000/ - . Party "B"
consented to it, but put a condition that, the party ought to execute a receipt.
As needs be, party "B" acquired their signatures on three clear stamp papers and
gave them amount of Rs. 60,000/ - .
From there on, in the year 2019, the party "B" had forcefully gotten possession
of the suit property. Party "A" later on came to realize that, the party "B" has
abused the three clear stamp papers having signatures of the party "A" and
brought into reality an agreement to sell and a possession receipt. Henceforth,
they filed and recorded a suit.
The party "B" opposed the claim of the party "A" by documenting written
statement. He rejected that, any produced document or documents have been got
executed by him. It is conceded that, party "A" needed monetary help yet he says
that they needed to sell the suit property, and along these lines, moved toward
him. The exchange took place and thought of the suit property was fixed at Rs.
3,20,000/ - .
Agreement to sell was executed on 22-04-2018 by accepting earnest amount of Rs.
120,000/ - . Around the same time possession receipt was executed, he was placed
in possession of the suit property. From there on by one more document which was
executed following a couple of days, party A No. 2 had gotten amount of Rs.
40,000/ - from him and executed document with that impact. Presently he is in
possession of the suit property and has spent gigantic amount on its
developmental activities. Also, he claimed that party "A" has filed a bogus suit
to get the property.
It has been contended by party "A" that it isn't in question that they were the
proprietors of the suit property. They had explicitly contended that their
signatures have been acquired on clear and blank papers when they went to party
"B" for loan. The examination of the document which has been styled as agreement
to sell and possession receipt, would show that, the agreement to sell has
That implies, possession was not given over by that document. However at that
point it is expressed that, around the same time another document has been
executed which shows that, by that document possession was given over. On the
off chance that the possession was given over upon the arrival of the agreement
to sell, which is expressed to have become effective on 22-04-2018, then, at
that point, it should have been registered and it was not on adequately stamped
I pick the side of party "A"
Section 54 in The Transfer of Property Act, 1882
54. "Sale" defined:
'Sale" is a transfer of ownership in exchange for a price paid or promised or
part-paid and part-promised. Sale how made.- 3 Such transfer, in the case of
tangible immoveable property of the value of one hundred rupees and upwards, or
in the case of a reversion or other intangible thing, can be made only by a
1In 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
Contract for sale.-A contract for the sale of immoveable property is a contract
that a sale of such property shall take place on terms settled between the
parties. It does not, of itself, create any interest in or charge on such
Section 55 in The Transfer of Property Act, 1882
55. Rights and liabilities of buyer and seller.�In the absence of a contract to
the contrary, the buyer and the seller of immoveable property respectively are
subject to the liabilities, and have the rights, mentioned in the rules next
following, or such of them as are applicable to the property sold:
Section 17 in The Registration Act, 1908
17. Documents of which registration is compulsory
- The seller is bound:
- to disclose to the buyer any material defect in the property or in the seller's title thereto of which the seller is, and the buyer is not, aware, and which the buyer could not with ordinary care discover;
- to produce to the buyer on his request for examination all documents of title relating to the property which are in the seller's possession or power;
- to answer to the best of his information all relevant questions put to him by the buyer in respect to the property or the title thereto;
- on payment or tender of the amount due in respect of the price, to execute a proper conveyance of the property when the buyer tenders it to him for execution at a proper time and place;
- between the date of the contract of sale and the delivery of the property, to take as much care of the property and all documents of title relating thereto which are in his possession as an owner of ordinary prudence would take of such property and documents;
- to give, on being so required, the buyer, or such person as he directs, such possession of the property as its nature admits;
- to pay all public charges and rent accrued due in respect of the property up to the date of the sale, the interest on all encumbrances on such property due on such date, and, except where the property is sold subject to encumbrances, to discharge all encumbrances on the property then existing.
- The seller shall be deemed to contract with the buyer that the interest
which the seller professes to transfer to the buyer subsists and that he has
power to transfer the same: Provided that, where the sale is made by a
person in a fiduciary character, he shall be deemed to contract with the
buyer that the seller has done no act whereby the property is encumbered or
whereby he is hindered from transferring it. The benefit of the contract
mentioned in this rule shall be annexed to, and shall go with, the interest
of the transferee as such, and may be enforced by every person in whom that
interest is for the whole or any part thereof from time to time vested.
- Where the whole of the purchase-money has been paid to the seller, he is
also bound to deliver to the buyer all documents of title relating to the
property which are in the seller's possession or power: Provided that, (a)
where the seller retains any part of the property comprised in such
documents, he is entitled to retain them all, and, (b) where the whole of
such property is sold to different buyers, the buye of the lot of greatest value is entitled to such
But in case (a) the seller, and in case (b) the buyer, of the lot of
greatest value, is bound, upon every reasonable request by the buyer, or by any
of the other buyers, as the case may be, and at the cost of the person making
the request, to produce the said documents and furnish such true copies thereof
or extracts therefrom as he may require; and in the meantime, the seller, or the
buyer of the lot of greatest value, as the case may be, shall keep the said
documents safe, uncancelled and undefaced, unless prevented from so doing by
fire or other inevitable accident.
- The seller is entitled:
- to the rents and profits of the property till the ownership thereof passes
to the buyer;
- where the ownership of the property has passed to the buyer before
payment of the whole of the purchase-money, to a charge upon the property in
the hands of the buyer, 1[any transferee without consideration or any
transferee with notice of the non-payment], for the amount of the
purchase-money, or any part thereof remaining unpaid, and for interest on
such amount or part 1[from the date on which possession has been delivered].
- The buyer is bound:
- to disclose to the seller any fact as to the nature or extent of the seller's interest in the property of which the buyer is aware, but of which he has reason to believe that the seller is not aware, and which materially increases the value of such interest;
- to pay or tender, at the time and place of completing the sale, the purchase-money to the seller or such person as he directs: provided that, where the property is sold free from encumbrances, the buyer may retain out of the purchase-money the amount of any encumbrances on the property existing at the date of the sale, and shall pay the amount so retained to the persons entitled thereto;
- where the ownership of the property has passed to the buyer, to bear any loss arising from the destruction, injury or decrease in value of the property not caused by the seller;
- where the ownership of the property has passed to the buyer, as between himself and the seller, to pay all public charges and rent which may become payable in respect of the property, the principal moneys due on any encumbrances subject to which the property is sold, and the interest thereon afterwards accruing due.
- The buyer is entitled:
- where the ownership of the property has passed to him, to the benefit of
any improvement in, or increase in value of, the property, and to the rents
and profits thereof;
- unless he has improperly declined to accept delivery of the property, to
a charge on the property, as against the seller and all persons claiming
under him, 2[* * *] to the extent of the seller's interest in the property,
for the amount of any purchase-money properly paid by the buyer in
anticipation of the delivery and for interest on such amount; and, when he
properly declines to accept the delivery, also for the earnest (if any) and
for the costs (if any) awarded to him of a suit to compel specific
performance of the contract or to obtain a decree for its rescission. An
omission to make such disclosures as are mentioned in this section,
paragraph (1), clause (a), and paragraph (5), clause (a), is fraudulent.
Maharashtra Stamp Act, 1958 - Section 34
- The following documents shall be registered, if the property to which
they relate is situate in a district in which, and if they have been
executed on or after the date on which, Act No. XVI of 1864, or the Indian
Registration Act, 1866, or the Indian Registration Act, 1871, or the Indian
Registration Act, 1877, or this Act came or comes into force, namely:
(b) other non-testamentary instruments which purport or operate to create,
declare, assign, limit or extinguish, whether in present or in future, any
right, title or interest, whether vested or contingent, of the value of one
hundred rupees and upwards, to or in immovable property.
Instruments not duly stamped inadmissible in evidence, etc. - No instrument
chargeable with duty [* * *] shall be admitted in evidence for any purpose by
any person having by law or consent of parties authority to receive evidence, or
shall be acted upon, registered or authenticated by any such person or by any
public officer unless such instrument is duly stamped [or if the instrument is
written on sheet of paper with impressed stamp [such stamp paper is purchased in
the name of one of the parties to the instrument
I will now begin my analysis:
The sale agreement may or may not lead to an effective sale of the property in
question. Some stamp duty laws, such as the Maharashtra Stamp Act, consider an
agreement to sell real estate the same as a formal deed of transfer and are
therefore subject to the same stamp duty as that applicable to the act itself.
deed of transfer or sale of a building. Because of such important provisions,
which require the payment of a stamp duty on a sales contract, people mistakenly
regard an agreement for sale as an appropriate deed of sale.
The Supreme Court of India in 2012, in the case of Suraj Lamp & Industries (P)
Ltd v State of Haryana, while dealing with the validity of sales of immovable
properties made through power of attorney, has held as under:
"Immovable property can be transferred/conveyed only by a deed of conveyance
(sale deed), duly stamped and registered as required by law. We, therefore,
reiterate that immovable property can be legally and lawfully
transferred/conveyed only by a registered deed of conveyance."
"Any contract of sale (agreement to sell), which is not a registered deed of
conveyance (deed of sale), would fall short of the requirements of Sections 54
and 55 of the Transfer of Property Act and will not confer any title, nor
transfer any interest in an immovable property (except to the limited right
granted under Section 53A of the Transfer of Property Act)."
Pursuant to the Transfer of Property Act, a purchase agreement, with or without
possession, is not an assignment. Article 54 of the Transfer of Property Act
states that the sale of immovable property can only take place by registered
deed and a purchase agreement does not entail any interest or burden on the
In addition, according to the Indian Registration Act of 1908, any agreement to
transfer an interest in real estate worth more than one hundred rupees must be
registered. Therefore, if you have bought a property under a contract of sale,
without a real deed of sale being followed, you will not acquire any right or
interest in the property that should be transferred under the contract of sale.
It becomes clear that ownership of a building can only be transferred by means
of a deed of sale. In the absence of a duly stamped and registered deed of sale,
no right, title or interest in real estate will revert to the purchaser of the
It is the buyer's responsibility to pay the stamp duty and registration fee for
the registration of the deed of sale and it is the buyer's responsibility to pay
the stamp duty and registration fee for the registration of the sale agreement.
In this case, party "A" argued that it is not in dispute that they were the
owners of the property in question. They had specifically argued that their
signatures were on blank papers when they went to party "B" for a loan. Reading
the document titled as an agreement of sale and receipt of property would show
that the agreement of sale has the nomenclature ".
". This means that ownership has not been transferred by this document. But then
it says that on the same day another document was executed, proving that the
property was transferred through this document. If the property was delivered on
the date of the promise to sell, which would have taken effect on 22-04-2018, it
should have been registered and it was not on sufficiently stamped paper.
Thus, according to the previous Supreme Court ruling, it can easily be said that
the fraudulent, deceitful and forcibly obtained possession of the property by
party "B" arose through misuse of the three blank papers bearing the signatures
of part "A." ", is invalid. If party "B" really wanted a lawful transfer of
Property, they should have had it transferred responsibly through a deed of
assignment (deed of sale), duly stamped and registered in accordance with the
law, because real estate is legal and can be legally transferred. / only
transferred by registered deed of assignment.
Any contract of sale (purchase agreement), which is not a registered deed of
assignment (deed of sale), as evidenced by the above facts of the case, would
not meet the requirements of Articles 54 and 55 of the Transfer of Property Act
and would not grant title to or transfer any interest in real estate.
After a complete perusal of the impugned facts of the case, and in light of the
Supreme Court ruling of Suraj Lamp & Industries (P) Ltd v State of Haryana,
which is extremely relevant to the present facts, I can conclude that party "B"
fraudulently took over possession of the immovable property belonging to party
"A" and that He does not deed of conveyance (sale deed), duly stamped and
registered as required by law needed to effectuate a legitimate transfer of the
property. Thus, party "B" should hand over possession back to party "A"
- Raveendran, R., 2021. Suraj Lamp & Industries (P) ... vs State Of
Haryana & Anr on 11 October, 2011. [online] Indiankanoon.org. Available at:
[Accessed 1 October 2021].