Case Note & Summary
The case involves a dispute over a plot of land allotted by a cooperative housing society to one of its members. The plaintiff, S. Kandhamani, was a member of the Central Government Employees Co-operative Housing Society, Tirunelveli. She applied for a house site and was allotted Plot No.152. She paid the cost of Rs.1,058/- on 09.07.1992 and a registered sale deed was executed in her favour on 20.07.1992, registered as Document No.1528/1992. Possession was handed over on the same day. Subsequently, the Special Officer of the Society executed a deed of cancellation dated 04.05.1993, registered as Document No.822/93, purportedly based on a resolution dated 27.02.1993. The plaintiff was not informed of this cancellation and alleged it was arbitrary and without authority. She filed a suit for declaration that the cancellation deed was null and void and for permanent injunction. The trial court decreed the suit in her favour, holding the cancellation invalid. The first appellate court reversed the decree, dismissing the suit. The defendant (Leelabai, who had purchased the property from the society after cancellation) filed a second appeal. The High Court framed a substantial question of law: whether the society could unilaterally cancel the registered sale deed. The court held that once a sale deed is registered, title passes to the vendee and the vendor cannot unilaterally cancel it without the vendee's consent or a court order. The cancellation deed was void. The court allowed the appeal, set aside the first appellate court's judgment, and restored the trial court's decree.
Headnote
A) Cooperative Law - Cancellation of Sale Deed - Unilateral Cancellation Void - Transfer of Property Act, 1882, Section 54; Registration Act, 1908; Specific Relief Act, 1963, Section 31 - The court considered whether a cooperative society could unilaterally cancel a registered sale deed executed in favour of a member. The court held that once a sale deed is registered, the title passes to the vendee and the vendor cannot unilaterally cancel the deed without the consent of the vendee or without a court order. The cancellation deed executed by the Special Officer was held to be void and not binding on the plaintiff. (Paras 7-14) B) Civil Procedure - Second Appeal - Substantial Question of Law - Section 100 CPC - The court framed a substantial question of law regarding the validity of unilateral cancellation of a registered sale deed. The court held that the first appellate court erred in reversing the trial court's decree and that the cancellation was invalid. (Paras 1, 15-16)
Issue of Consideration
Whether a cooperative housing society can unilaterally cancel a registered sale deed executed in favour of a member without the consent of the member or without an order from a competent court.
Final Decision
The High Court allowed the second appeal, set aside the judgment and decree of the first appellate court, and restored the decree of the trial court. The suit was decreed declaring the cancellation deed dated 04.05.1993 as null and void and granting permanent injunction against the defendants.
Law Points
- Unilateral cancellation of a registered sale deed by a vendor without consent of the vendee or court order is void
- Cooperative society cannot cancel a sale deed without following due process
- Section 31 of Specific Relief Act
- 1963 provides remedy for cancellation of instruments
- Section 54 of Transfer of Property Act
- 1882 defines sale as transfer of ownership
- Registration Act
- 1908 does not permit unilateral cancellation of registered sale deed
