Agreement to Sell within Section 53-A Transfer of Property Act

  • Letters written by transferor agreeing to sell his part of the share in property. Letters not spelling out the terms of the agreement or time frame within which the sale deed was to be executed.

The Supreme Court of India in Mool Chand Bakhru Vs. Rohan, AIR 2000 SC 745 : (2000) 2 SCC 528 : 2002 (1) SCR 702 : 2002 (1) SCALE 507 : JT 2002 (1) SC 465 : 2000 AllLJ 491 held that letters written by transferor could not be construed to be an agreement to sell within the meaning of Section 53-A of the Act.

A bench comprising of Justice V.N. Khare and Justice Ashok Bhan set aside the Order of the High Court holding that the letters constitute a valid agreement to sell, allowing the claim for part- performance of contract.

# Agreement to Sell

The issue involved in the present appeal is whether a proposed vendee could protect his possession of an immoveable property on the plea of part performance under Section 53-A of the Transfer of Property Act, 1882 on the basis of an oral agreement.

Plaintiff-appellants were owners of the property in dispute. They had permitted the predecessor-in-interest of respondent to occupy the suit property as a licensee. When respondent failed to vacate the property, the appellants filed a suit for possession of the property and for recovery of mesne profit.

Respondent resisted the suit contending that appellant No. 1 wrote several letters agreeing to sell his half share of property had also received certain sale consideration. Thus, they claimed protection under section 53-A of T.P. Act and also alternatively claimed title by adverse possession.

Trial Court held that the respondents have perfected the title to the property in dispute by way of adverse possession to the extent of half share of appellant No. 1 and dismissed the suit to that extent. However, on appeal the First Appellate Court decreed the suit of appellants for possession of entire property in dispute alongwith mesne profits.

On second appeal, High Court held that respondents were entitled to protect the possession under section 53-A of the Act. Hence the present appeal by plaintiff.

Allowing the appeal, the Apex Court held that Section 53-A of the Transfer of Property Act, 1882 provides that where any person contracts to transfer for consideration any immoveable property, in writing signed by him or on his behalf from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty and 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 any possession in part performance of the contract, and has done some act in furtherance of the contract and the transferee has performed or is willing to perform his part of the contract then he is entitled to protect his possession in respect of the property of which he was put in possession in part performance of the agreement to sell.

# Case Law Reference

  1. Nathulal v. Phool Chand, [1969] 3 SCC 120
  2. Sardar Govindrao Mahadik v. Devi Sahai, [1982] 1 SCC 237
  3. Mohan Lal (deceased) through his LRs. Kachru and Ors. v. Mirza Abdul Gaffar and Anr., [1996] 1 SCC 639
  4. Roop Singh v. Ram Singh, [2000] 3 SCC 708

In the instant case, the letters written by appellant No. 1 cannot be termed to be agreement to sell within the meaning of Section 53-A spelling out the terms of the agreement for sale. At the most it is an admission of an oral agreement to sell and not a written agreement.

Statutorily the emphasis is not on written agreement only. In addition the emphasis is on the terms of the agreement as well which can be ascertained with reasonable certainty from the written document.

In the instant case, there was no meeting of minds. Admission made by appellant No. 1 of an oral agreement to sell does not spell out other essential terms of agreement to sell such as time frame within which the Sale Deed was to be executed and as to who would pay the registration charges etc. Written agreement has to precede the putting of the proposed vendee in possession of the property.

In the instant case, the predecessor in interest of the respondents was never put in possession of the property pursuant to the written agreement arrived at between the parties. Thus, High Court fell in error in coming to the conclusion that the letters written by appellant No. 1 constituted an agreement to sell. The suit filed by plaintiff/appellants for possession of property and mesne profit is decreed.

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