Case Note & Summary
The dispute arose from a suit for specific performance filed by the appellants against the respondents regarding a sale deed executed on 22.2.1988. The appellants claimed to have paid Rs.17000 towards the sale price of Rs.22000, with the balance of Rs.5000 to be paid later. The second respondent, however, contended that no payment was made and subsequently cancelled the sale deed on 18.3.1988, selling the property to the first respondent. The trial court initially decreed the suit in favor of the appellants, but the first appellate court reversed this decision, finding that the appellants failed to prove payment of the sale price. The High Court upheld this finding, leading to the present appeal. The Supreme Court examined whether the appellants had indeed paid the amount, whether title passed upon execution of the sale deed, and whether the vendor was justified in cancelling the sale. The court noted that the intention of the parties, as reflected in the sale deed, was crucial in determining whether title passed. It was established that the appellants did not pay the full consideration, and thus, title did not pass to them. The court also recognized the practice of 'ta khubzul badlain' in Bihar, which stipulates that title passes only upon the exchange of the registration receipt for the sale price. Ultimately, the court dismissed the appeal, affirming that the appellants were not entitled to the relief sought as the sale deed was effectively cancelled due to non-payment.
Headnote
A) Property Law - Sale Deed - Passing of Title - Transfer of Property Act, 1882, Sections 8, 54 - Title does not pass until payment of full consideration is made if that is the intention of the parties, as evidenced by the sale deed and surrounding circumstances. The court held that since the appellants failed to prove payment of the sale price, the title did not pass to them and the sale deed was effectively cancelled by the vendor (Paras 8-14).
Issue of Consideration
Whether the appellants had paid Rs.17000/- towards sale price to second respondent? Whether title to the property passed to the appellants on execution of the sale deed? Whether the second respondent-vendor was justified in cancelling/repudiating the sale on the ground that the sale consideration was not paid? Whether the appellants are entitled to the relief claimed in the suit?
Final Decision
The Supreme Court dismissed the appeal, affirming that the appellants did not prove payment of the sale price and thus title did not pass to them. The court upheld the vendor's right to cancel the sale due to non-payment.
Law Points
- Specific performance
- sale deed
- payment of consideration
- intention of parties
- ta khubzul badlain
