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Tag: The Essentials of part performance

DOCTRINE OF PART-PERFORMANCE

Doctrine of Part Performance is an equitable doctrine and it is incorporated to prevent fraud and from taking illegal advantage on account of non-registration of the document. In the old Madras case, Kurri Veera Reddi v Kurri Bapi Reddi (1906) 29 Mad 336 : 16 Mad LJ 395, the High Court held that the English doctrine of part-performance was not applicable in Indian law. In 1914, the Privy Council in Md Musa v Aghore Kumar Ganguly (1914) 42 Cal 801 : AIR 1914 PC 27, held that the doctrine of part performance was applicable in India on the principle of justice, equity, and good conscience.

Section 53-A of the Act, deals with definition of the doctrine and it says:

When any person contracts to transfer for consideration any immovable property by 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 in 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, notwithstanding that where there is an instrument of transfer, that the transfer has not been completed in the manner prescribed therefore by the law time being in force, the transferor or any person claiming under him shall be debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided by the terms of the contract:

Provided that nothing in this section shall affect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof.

llustration:

A contract to transfer his immovable property to B by way of sale and put B in possession of the property before a regular Sale-Deed is executed. The contract is said to be partly performed and if later on A refuses to execute regular document of sale and files a suit for eviction against B treating B as trespasser. Then B can resist A’s claim on the ground that the contract of transfer in his favour has partly been performed and that A should not be allowed to go back upon his own word.

Essential Requirements of section 53A of Transfer of property Act

 (1) There must be a contract to transfer an immovable property for consideration.

(2) The contract should be in writing and its terms can be ascertained with reasonable certainty.

(3) The transferee should have taken possession of the property in part performance of the contract or if he is already in possession, should have continued in possession in part performance of the contract, and should have done something in furtherance of the contract.

 (4) The transferee is ready and willing to perform his part of the contract.

Section 53 A creates benefits in favor of a person who has a prior agreement in his favor along with the possession of land mentioned in the agreement. The section creates a bar against the original owner or any person claiming title under him, for claiming any right of title or interest qua land mentioned in the agreement.

Therefore, if his possession is threatened, it is only the injunction suit that can be filed by the person claiming the benefit of the section. His remedy is not limited to taking defense in case a suit is filed against him. He can be a proper plaintiff also if he shows and proves the requirements of the section along with registration[6]. The protection provided by the section deals with the mixed questions of facts as well as law.

Scope of Doctrine of Part Performance

1. In plain reading, a transferor shall take ownership part in the execution of the contract for the property in question, aside from meeting the other provisions, using the shield provided for in this clause, and having done so to promote the contract.

2. Where the relevant contract does not comply with the provisions of a legal contract, the court cannot accept the plea referred to herein. For a transferor to use insurance in this clause, there must then be a legal contract.

3. The purpose of this provision is restricted only to the placing by the transferor, in connection with a property already owned by the transferor, of a bar on the protection of the rights.

4. The section grants no right on unregistered transfer to the transferor to assume custody of the transferor or any other right, it is only applicable to him as a protection.

5. For this clause to apply, the contract must be linked effectively to actions performed in support of the contract or to actions that may be unequivocally alluded to in that contract.

6. Where there is no transfer arrangement or land, the applicability issue of this provision does not arise.

7. The transferor must be the owner to attract the disposition of this section, a sales agreement should be concluded and the transferor’s possession should be by that agreement and the transferor has to do something else to support the agreement, and he has to be willing and willing to fulfill his part of the agreement.

The objective of Doctrine of Part Performance

1. The statute obliges both the transferor and the transferee to carry out a transfer. The transferee is generally required to pay the consideration under the terms of the contract and to perform the transfer act in a manner specified by Statute, the transferor is responsible for the transferee.

2. Section 53A centers on maintaining the transferee’s right to maintain ownership of the property if the transferee does not have liability because of the fault by the transferor in completing the convey instrument in the way stipulated by statute.

3. This section deals to prohibit the transferor or his successor from using a record that is not being registered provided the transferor performs the contractual portion and has taken care of any immovable property in connection with the conclusion of the contract.

4. To protect his property, the transferor has the right as a defense himself.

5. This section affects partial equality and partial incorporation in the Indian legal framework of the doctrine of partial results.

6. In the absence of a registered agreement, this provision provides for the procedural defense such that a person can retain ownership of his portion of the deal.

7. The primary purpose of this clause is to prohibit the recipient or parties claiming the title in violation of the interests of the other contracting party who has acted as a result of the agreement concluded.

8. This provision provides the accused with the ability to shield his possession from the transferor or others claiming his right under him, such as his heirs, assigned persons and legal agents.

9. This clause stipulates the transferor with a contractual bar that does not confer title to the transferor over the property in question. The transferred party cannot then bring an action to declare his rights to the land and to retrieve ownership on the grounds of the asserted title.

10. The transferee will still exercise his right as a shield, but he will not be allowed to exercise his right as a separate claim, either as complainants or defendant, only because he has satisfied the conditions specified in this clause, he does not assert the right under the present clause.

Section 53-A

Bombay High Court in Kamalabai Laxman Pathak v. Onkar Parsharam Patil, has given emphasis on the ingredients of the Section 53-A which are as follows:

  1. Contract for Transfer of immovable property:
    For the application of this section, the first condition is that there must be a contract and the contract must be transfer of immovable property for value.
    a) Written contract:
    The contract must be written. Section 53 –A is not applicable if the contract for transfer is oral. In V.R. Sudhakara Rao v. T.V. Kameswari case , it was held that the benefit of section 53-A is not available to a person who is in possession of property based on oral agreement of sale. Writing alone is not sufficient. The contract must also be duly executed. That is to say, it should be signed by the transferor or by any other person on his behalf.

    b) Valid Contract:
    It may be noted that Section 53-A is applicable only where contract for the transfer is valid in all respects. It must be an agreement enforceable by law under the Indian Contract Act, 1872.
  1. Immovable property:
    This section is applicable only in case of transfer of immovable property. It does not apply to an agreement for the transfer of movable property even though supported with consideration. The defense of Part Performance is not available in respect of possession of movables . 
  2. Transfer for consideration:
    The written contract must be for the transfer of an immovable property for consideration. The written contract on the basis of which the property has been possessed, must clearly suggest the transfer of property. If the document is ambiguous or confusing, this section cannot be made applicable. It is one of the necessary ingredients of section 53-A that the terms of written contract must be ascertainable with reasonable certainty.
  3. Possession in furtherance of Contract:
    The Transferee has taken possession or continues possession in part performance of the contract or, has done some act in furtherance of the contract
  4. Some Act in furtherance of the contract:
    Taking possession is not only the method of part performance of contract. If the transferee is already in possession of the property then, after the contract of transfer, he has to do some further act in part performance of the contract (Nathulal v. Phoolchand.
     
  5. Transferee is willing to perform his part of contract:
    Section 53-A is based on the principle of Equity. Equity says that one who seeks equity must do equity. Therefore, where a person claims protection of his possession over a land under section 53-A, his own conduct must be equitable and just. It is an essential condition for the applicability of this section that the transferee must be willing to perform his part of contract (Sardar Govindrao Mahadik and Anr. vs. Devi Sahai and Ors Govind AIR 1982 SC 989

Difference between the Doctrine of part performance followed in Common Law and Indian Law:

1. Under English Law, there is no need for a written agreement to attract the doctrine. An oral agreement can also invoke the doctrine of part performance. Whereas in Indian Law, the contract or the agreement has to be in writing.

2. In India, the protection provided under the doctrine can only be used to defend and it cannot be used as an independent remedy. Whereas in English Law, the doctrine can be used as both: a defense and an attack. Hence, it can be used to enforce a right of possession and not merely to protect it.