INDIRA DEVI versus VEENA GUPTA & ORS. on 4 July 2023

1. The appellant herein has challenged the order dated September26, 2013 passed by the High Court of Judicature at Patna in SecondCAppeal No. 123 of 2000.

2. The facts of the case available on record are being noticedhere. Kaleshwar Prasad Singh was inducted as a tenant in the propertyin question by late Kishori Lal Sahu who was the exclusive owner thereof.He along with his son executed a conditional sale deed dated 5.8.1977 inDfavour of Indira Devi d/o Kaleshwar Prasad Singh. It was mentioned inthe sale deed that vendors were in dire need of money, hence, with theconsent of family members, conditional sale deed was being executed infavour of the vendee for a total sale consideration of 5000/-. Thecondition in sale deed was that in case the vendors return the fullconsideration amount to the vendee by July, 1984, the vendee wouldEreturn the property by means of a registered sale deed at the cost of thevendors. In case, the vendors fail to pay the consideration money withinthe stipulated time, the vendee will become exclusive owner of theproperty. Till then the vendee would not deal with the property in anymanner whatsoever.

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3. Late Kishori Lal Sahu executed a registered gift deed dated14.02.1983 in favour of his daughter-in-law, Veena Gupta w/o GopalPrasad. The description of the property was detailed out in the GiftDeed, wherein it was stated that the executant was old and the beneficiarywas taking care of him, hence the properties are being gifted to her.GNumber of properties were gifted. It was mentioned therein that theproperty as mentioned at column no. 5 therein was transferred to IndiraDevi by way of registered sale deed dated 5.8.1977, which can bepurchased back by Veena Gupta from Indira Devi.

4. The vendors were ready and willing to return 5000/- to thevendee to get the sale deed registered back in their name but the vendeeH

was not agreeing to the same. The civil suit was filed by the respondentno.1 along with Kishori Lal Sahu (now deceased) in 1983. The prayer inthe suit was for a direction to the appellant to accept 5000/- asconsideration money and execute sale deed in favour of respondent no.1in respect of the house as mentioned in the suit. On failure, decree bepassed directing appellant to register the sale deed in favour of therespondent no.1, the first plaintiff and as a consequence, the plaintiffs beput in possession of the property in question. In the alternative, the prayerwas that there is a relationship of landlord and tenant between KishoriLal Sahu (non deceased), the second plaintiff and Kaleshwar PrasadSingh, the first defendant. A decree of eviction be passed in favour ofthe plaintiffs on the ground of personal necessity and non payment ofrent and the possession be got delivered. The Trial Court vide judgmentdated 27.9.1986 dismissed the suit. The judgment and decree of theTrial Court was upheld by the lower appellate court vide judgment andorder dated 27.1.2000. In second appeal filed by the respondents, thejudgments of the courts below were reversed by the High Court videjudgment dated 26.09.2013. The High Court framed the followingsubstantial questions of law:

“(i) Whether the courts below committed error in dismissing thesuit of the plaintiff on wrong approach and on consideration of anissue which was not material for the purpose of adjudication ofthe suit?

(ii) Whether the courts below committed error in not consideringthe main issues involved in the suit regarding character andconstruction in respect of the deed impugned?

(iii) Whether the courts below committed error in not consideringthe issue of merger of tenancy to the ownership as is relevant inthe deed of sale?”

ARGUMENTS OFTHE APPELLANTS

5. The argument raised by the learned counsel for the appellantwas that late Kishori Lal Sahu executed the conditional sale deed alongwith his son in favour Indira Devi on 5.8.1977. He had no right to assignhis right to repurchase the property, to any third party, the right beingpersonal to him. Even otherwise there was no clause in the sale deed interms of which such right could be assigned to anyone else. It wasfurther submitted that the Gift Deed by which the property was given to AB

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AVeena Gupta cannot be termed as Gift Deed as there was considerationfor transfer of the property in question as she could get the property inquestion only on payment of the consideration money mentioned in thesale deed. It was further submitted that from a perusal of the plaint, it isnot evident that the plaintiffs were always ready and willing to fulfil thecondition as mentioned in the conditional sale deed as they had no moneyBavailable with them. Further, the stand taken by the appellant in thewritten statement was that late Kishori Lal Sahu was not keeping goodhealth, hence the Gift Deed executed in favour of Veena Gupta was nota valid document.

6. In support of the plea that the right as conferred in the sale deedCbeing personal, could not be assigned, reliance was placed upon thejudgments of this Court in Bhoju Mandal and Ors. vs. Debnath Bhagatand Ors.[1] and Kapilaben and Ors. vs. Ashok Kumar Jayantilal Sheth,through POA Gopal Bhai Madhusudan Patel and Ors[2]. It was furtherargued that multiple reliefs having been claimed in the suit, the sameDwas not maintainable as on the one hand, the claim was for specificperformance whereas on the other hand, the plea of tenancy was alsoraised.

ARGUMENTS OF THE RESPONDENTS

7. On the other hand, learned counsel for the respondents submittedEthat the only relief pressed by him is at serial no. 1 in the suit i.e. withreference to the specific performance with possession. It is a case inwhich late Kishori Lal Sahu, father-in-law of Veena Gupta, had executedthe Gift Deed in her favour pertaining to his properties including theproperty in question. It is specifically mentioned in the Gift Deed thatFVeena Gupta can take possession of the property sold to Indira Devi bypurchasing the same from her. She will have all rights available to herwhich late Kishori Lal Sahu had. As per the condition in the sale deed,the property could be repurchased in case 5000/- were paid to IndiraDevi up to July, 1984. The amount was offered to Indira Devi, however,when she refused to accept the same, civil suit was filed. As the appellantsGwere not accepting the consideration, during the pendency of the civilsuit an application was filed in March, 1984 seeking permission to deposit 5000/- in the Court. On permission being granted by the Court, theamount was deposited in Court on April 29, 1984. Hence, there was 11963 Supp (2) SCR 82H2 (2020) 20 SCC 648

compliance of the condition laid down in the sale deed for getting theproperty back. The right to get the aforesaid property back was assignedby late Kishori Lal Sahu to the respondent no.1 vide registered gift deed.The error committed by both the courts below in dismissing the suit wascorrected by the High Court.

8. To counter the argument raised by the learned counsel for theappellant that the right being personal to the deceased late Kishori LalSahu, could not be assigned, reliance was placed upon judgment of thisCourt in T.M. Balakrishna Mudaliar vs. M. Satyanarayana Rao andOrs.[3] and Shyam Singh vs. Daryao Singh (dead) by LRs and Ors[4]. Itwas submitted that such a right is not personal and the same can alwaysbe assigned. In any case, it was not assigned in favour of any third partyrather it was by the father-in-law of Veena Gupta in her favour, as hewas getting old. It was in the family only. He further submitted thatSpecial Leave Petition bearing SLP(C) No. 5910 of 2014 filed by RajmaniDevi & Ors. against Veena Gupta, respondent no.1 herein challengingthe same judgment on the issue of default in payment of rent on the partof original defendants was dismissed by this Court on 21.02.2014.

9. Heard learned counsel for the parties and perused the record.

DISCUSSION

10. The primary issue which requires consideration in the presentappeal is as to whether the vendor can assign the right contained in asale deed to get the property registered back or the right being personalcannot be assigned.

11. The contents of the documents placed on record would berelevant to appreciate the issue. The relevant clauses in the conditionalsale deed are extracted hereinbelow: - “That the vendors after taking confident of the vendee about theright title of the vendors and possession executed the conditionalsale deed on valid consideration of Rs.5,000/ {Rupees fivethousands} only and handed over the full right title and possessionto the vendee St. Indira Devi having left no concern with theproperty. The vendors were out of the purview of Land CallingAct.

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That the conditional sale deed is being executed on condition thatif the vendors would return the full consideration money to thevendee by July 1984 then the vendee would return the same bymeans of registered sale deed at the cost of the vendorsand thevendors fail to return the consideration money within the stipulatedtime the vendee would be full owner of the property till then thevendee would neither execute any deed of conveyance to otherswith respect to the land would mortgage the land nor would becamethe guarantor over the land nor would take loan over the land, if itwould have been done it would be illegal. The vendee would alsoneither change the physical feature of the house nor the vendeewould be entitle to pay the rent to the state of Bihar.

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If the vendors intend to return the consideration money to thevendee within the stipulated period the vendee would execute asale deed in favour of the vendors (failing which/the vendors woulddeposit the full consideration money in the court and the right titleDof the vendee would be seized and in that case the vendee wouldbear the cost of the damages. If the vendee would be dispossessedfrom the afore said land or part thereof on account of some legalcomplication the vendors and their legal heirs would be liable topay the full consideration money -A with damages to the vendee.The vendee would acquired full right title over the afore said landEafter the expiry of stipulated period and the vendors would haveno option or right there after to interfere with respect to the righttitle and possession of the vendee and the vendee would havebeen on liberty to mutate his name in place of vendors and utilizethe land as per her choice if any interference is made by theFvendors or their heirs would be illegal by the court and the vendorswould be entitle to bear the cost and damages”.

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(emphasis supplied)

12. The relevant clauses in the Gift Deed are extractedhereinbelow:- G

“I, the executant, am in possession of the above-mentionedproperty. I am in old age now and God knows when this life willcome to an end. That beneficiary of this document is the Potehu(daughter-in-law) of the executant. She takes care of me, theexecutant and I am happy with her care. Therefore, I have decided H

to gift my entire property to her and make her owner of my all theproperties like me.

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Only some property, as mentioned at column No. 5, has beengiven to Smt. Indira Devi through sale deed dated 5.8.1977. Noother document regarding these properties has been executed.

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She can also take the possession of property sold to Indra Deviand Malti Devi by purchasing the same from her. Now she willget all the rights which I was enjoying till date in respect of above-mentioned property.”

13. The civil suit was filed by late Kishori Lal Sahu and VeenaGupta against Kaleshwar Prasad and Indira Devi. The primary reliefwhich has been pressed by the plaintiff is extracted below:- “(a)A decree for specific performance of contract bepassed in favour of the plaintiff first party and the defendantfirst be directed to take 5000/- from the plaintiff first partyand the defendant second party be directed to execute andregister a sale deed with respect to the suit house detailed inSchedule-I below in favour of the plaintiff first party and putthe plaintiff first party in possession and on failure of thedefendants to do so, the court may be pleased to execute andregister a sale deed in favour of the plaintiff first party onbehalf of defendant second party and a decree for recoveryof possession be passed and the plaintiff first party be put inpossession by delivery of possession through court bydispossessing the defendants or anybody else whosoever befound in possession on behalf of the defendant second party.”

14. As has already been noticed, the Trial Court as well as thefirst Appellate Court had dismissed the suit whereas the High Court hadreversed the findings and decreed the same.

LEGAL POSITION

15. The issue was considered by this Court in T.M. BalakrishnaMudaliar (supra) wherein reference was made to earlier judgment ofPrivy Council in Sakalaguna Nayudu v. Chinna Munuswami A

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ANaykar[5]. This Court opined that the benefit of a contract of repurchasewhich did not show that it was intended only for the benefit of the partiescontracting, could be assigned. The option given to repurchase theproperty sold would prima facie be assignable. Para 9 of the judgment isextracted below:- B“9.The Privy Council in Sakalaguna Nayudu v. ChinnaMunuswami Naykar has held that the benefit of a contractof repurchase which did not show that it was intended onlyfor the benefit of the parties contracting, could be assignedand such contract is enforceable. Beaumont, C.J. inVishweshwar Narsabhatta Gaddada v. Durgappa IrappaCBhatkar6held that both under the common law as well as underSection 23(b) of the Specific Relief Act, 1877, an option givento repurchase the property sold would prima facie beassignable, though it might also be so worded as to show thatit was to be personal to the grantee and not assignable. OnDthe particular facts of that case, it was held that the contractwas assignable. In Sinnakaruppa Gounder v. KaruppuswamiGounder[7], it was held:

“In our view, generally speaking, the benefits of a contractof repurchase must be assignable, unless the terms of theEcontract are such as to show that the right of repurchase ispersonal to the vendor. In the latter case it will be for theperson who pleads that the contract is not enforceable, toshow that the intention of the parties thereto was that it wasto be enforced only by the persons named therein and not bythe assignee.”F

16. Again, the issue came up for consideration before this Court inShyam Singh case (supra), wherein judgments of the Privy Council inSakalaguna Nayudu and this Court in T.M. Balakrishna Mudaliar(supra) were referred to. It was a case in which a conditional sale deedwas registered with a right of repurchase. The conditions as mentionedGin the sale deed in the aforesaid case, which were similar to the case inhand, are extracted below:- H

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6 AIR 1940 Bom 339 : 42 BLR 653 : ILR 1940 Bom 6747 AIR 1965 Mad 506 : ILR (1965) 2 Mad 20

INDIRA DEVI v. VEENA GUPTA & ORS.[RAJESH BINDAL, J.]

“Whereas we, Daryao Singh, son of Hardeva, the first party andSurajmal, Peetam and Babu, sons of Rati Ram, the second party,Jat, residents of Village Nala, Pargana Kandhala, Tehsil Budhana,District Muzaffarnagar. Party 2 has executed a sale deed todayin favour of Party 1 for a sum of Rs 4900 in respect of 2 bighas 7biswas of the land of Khasra No. 95, bearing a rent of Rs 6.25annually situate in Khata No. 331 of Village Nala, ParganaKandhala, Tehsil Budhana, District Muzaffarnagar, about whichit was agreed between the parties that if the second party paidthe entire consideration of the sale deed of Rs 4900 to the firstparty or to the heirs of thefirst party within ten years from todaythen in that situation the first party will reconvey the aforesaidland by sale deed in favour of the second party without anyobjection. If for any reason the first party does not execute asale deed in favour of the second party, after five years butwithin ten years from the date of sale deed dated 4-2-1971,then the second party will have a right to deposit the entireconsideration of Rs 4900 in the civil court and get the saledeed executed by the court, the first party will have noobjection. The present agreement will be binding upon theparties and the heirs of the parties. Therefore, these fewcomments by way of agreement of reconveyance of sale withinten years are being written so that this document may be usedwhen necessary. After the limitation of ten years the second partywill have no right at all to get released the aforesaid from Party1.”

17. In Shyam Singh’s case (supra) the party having right torepurchase the land sold the rights to a third party for a consideration of 19,000/- by way of a registered document. The right to repurchasewas available to him on payment of 4900/-. All the courts below hadopined that if there is no clause in the sale deed permitting assignment ofright to repurchase, the same could not be transferred. When the mattercame up before this Court, the question under consideration was whethersuch a prohibition against assignment or transfer can be read into thedocument by implication. The opinion expressed was that a long periodof ten years was fixed for obtaining re-conveyance, no implied prohibitionof transfer or assignment can be inferred in the document keeping in AB

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Aview the provisions of Section 15(b) of the Specific Relief Act. Therelevant paras of the judgment are extracted below:-

“13.In our considered opinion, in the absence of any wordsor expressions in the documents indicating prohibition onassignment or transfer of right of repurchase and in the faceof clear provisions of Section 15(b) of the Specific Relief Act,1963, an implied prohibition cannot be read into the terms ofthe documents. Merely because in the documents, there ismention of “heirs” of the contracting parties but not their“assignees” or “transferees”, the legal right of assignmentavailable to the benefit of original contracting party underSection 15(b) of the Act cannot be denied to it.

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14. We are fortified in our view by two direct decisions of thisCourt rendered in somewhat similar circumstances withdocuments contemporaneously executed for sale andrepurchase with comparable stipulations. See T.M.Balakrishna Mudaliar v. M. Satyanarayana Rao (supra) andHabiba Khatoon v. Ubaidul Huq[8]".

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15. In the case of Habiba Khatoon [(1997) 7 SCC 452] takingstock of earlier decisions of this Court, the Privy Council and theHigh Court of Bombay, the law on the present-contested issueEwas explained to uphold the right of repurchase of the originalcontracting party thus:

“We may in this connection also usefully refer to a decision ofthis Court in the case of T.M. Balakrishna Mudaliar v. M.Satyanarayana Rao [(1993) 2 SCC 740]. Considering theprovisions of Section 15(b) of the Specific Relief Act, 1963 aBench of two learned Judges of this Court speaking throughKasliwal, J., endorsed (in para 10 of the SCC) the statementof law flowing from the decision of SakalagunaNayudu [Sakalaguna Nayudu v. Chinna MunuswamiNayakar, AIR 1928 PC 174 : 55 IA 243 : 32 CWN 850] aswell as the decision of Beaumont, C.J., speaking for the BombayHigh Court in the case of Vishweshwar NarsabhattaGaddada v. Durgappa Irappa Bhatkar [AIR 1940 Bom 339: 42 Bom LR 653 : ILR 1940 Bom 674] . The statement of law F

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INDIRA DEVI v. VEENA GUPTA & ORS.[RAJESH BINDAL, J.]

which got imprimatur of this Court in para 9 of the Report runsas follows:

‘The Privy Council in Sakalaguna Nayudu v. ChinnaMunuswami Nayakar [Sakalaguna Nayudu v. ChinnaMunuswami Nayakar, AIR 1928 PC 174 : 55 IA 243 : 32CWN 850] has held that the benefit of a contract ofrepurchase which did not show that it was intended onlyfor the benefit of the parties contracting, could be assignedand such contract is enforceable. Beaumont, C.J.in Vishweshwar Narsabhatta Gaddada v. DurgappaIrappa Bhatkar [AIR 1940 Bom 339 : 42 Bom LR 653 :ILR 1940 Bom 674] held that both under the common lawas well as under Section 23(b) of the Specific Relief Act,1877, an option given to repurchase the property sold wouldprima facie be assignable, though it might also be so wordedas to show that it was to be personal to the grantee and notassignable. On the particular facts of that case, it was heldthat the contract was assignable. In SinnakaruppaGounder v. M. Karuppuswami Gounder [AIR 1965 Mad506 : ILR (1965) 2 Mad 20 :

In our view, generally speaking, the benefits of a contractof repurchase must be assignable, unless the terms ofthe contract are such as to show that the right ofrepurchase is personal to the vendor. In the latter caseit will be for the person who pleads that the contract isnot enforceable, to show that the intention of the partiesthereto was that it was to be enforced only by the personsnamed therein and not by the assignee.

16. From the statement of law as has been approved and followedby this Court in two decisions in Habiba Khatoon [(1997) 7 SCC452] and T.M. Balakrishna Mudaliar [(1993) 2 SCC 740] , unlessthe contents of the document in question and evidence in relationthereto are so clear to infer a prohibition against assignment ortransfer, the right of repurchase has to be held to be assignable ortransferable and cannot be treated as personal to the contractingparties.

17. On a very unsubstantial ground that the document in questionmakes a mention only of “parties” and their “heirs” and not AB

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A“assignees” or “transferees”, it cannot be held that the right ofrepurchase was not assignable. In our considered opinion,therefore, the courts below were in error in construing thedocument in question in a manner to infer an implied prohibitionagainst assignment and transfer.”

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18. It may be noticed that the earlier two judgments of this Courtin T.M. Balakrishna (supra) and Habiba Khatoon (supra) were citedwith approval. Right of repurchase was held to be assignable ortransferable and cannot be treated as personal to the contracting parties.

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19. To be fair to the appellant, we refer to the judgments cited bylearned counsel for the appellant, which do not support his case. In BhojuMandal and Ors’s case (supra), the issue under consideration was asto whether the document in question there was a mortgage or a salewith condition of repurchase. The same was decided on construction ofthe clauses in the document. It was in that reference this Court observedDthat there is a distinction between the said two concepts. The issue canbe resolved only by ascertaining the intention of the parties on aconsideration of the contents of the documents. The specific issue underconsideration therein was not as to whether the right to repurchase waspersonal to the vendor or the same could be assigned or not. The judgmentEof the High Court opining that the document therein was not a mortgagebut a sale with a condition of repurchase was upheld.

20. In Kapilaben and Ors.’s case (supra) this Court had consideredthat assignment of a contract might result in transfer of either rights orobligations thereunder. The transfer of obligations is not possible withoutFthe consent of the other party. The transfer of right is permissible exceptin cases where the contract is of personal nature. Relevant paras thereofare extracted below:- “24.It is well-settled that the term “representative-in-interest”includes the assignee of a contractual interest. Though theGprovisions of the Contract Act do not particularly deal with theassignability of contracts, this Court has opined time and againthat a party to a contract cannot assign their obligations/liabilitieswithout the consent of the other party. A Constitution Bench of this Court in Khardah Co. Ltd. v. Raymon & Co. (India) (P)Ltd.[9], has laid out this principle as follows :

“19. … An assignment of a contract might result by transfereither of the rights or of the obligations thereunder. But thereis a well-recognised distinction between these two classes ofassignments. As a rule obligations under a contract cannotbe assigned except with the consent of the promisee, andwhen such consent is given, it is really a novation resultingin substitution of liabilities. On the other hand, rights undera contract are assignable unless the contract is personal inits nature or the rights are incapable of assignment eitherunder the law or under an agreement between the parties.”

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27. Even in a case of assignment of rights simpliciter, suchassignment would necessarily require the consent of the otherparty to the contract if it is of a “personal nature”. This is elucidatedby the learned authors Pollock and Mulla in their commentaryon The Indian Contract and Specific Relief Acts (R. YashodVardhan, and Chitra Narayan, Eds., 15th Edn., Vol. I) at p. 730:

“A contract which is such that the promisor must perform it inperson viz. involving personal considerations or personal skillor qualifications (such as his credit), are by their nature notassignable. The benefit of contract is assignable in ‘cases whereit can make no difference to the person on whom theobligation lies to which of two persons he is to dischargeit’. The contractual rights for the payment of money or to”building work, for e.g. do not involve personal considerations.

21. It can be summed up from the aforesaid judgments that thecondition of right to repurchase in sale deed will not be personal to thevendor unless the terms in the documents specifically state so. Such aright can always be assigned and the contract containing such conditionshall be enforceable. The only exception being that such a right shouldnot be personal in nature. The assignment of obligations in a document isnot possible without the consent of the other party. No implied prohibitionof transfer or assignment can be inferred in a document. The benefit of A

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Acontract is assignable in cases where it does not make any difference tothe person on whom the obligations lies, to which of two persons he is todischarge.

22. If the facts of the case in hand are considered, we do not findthat there is any term in the conditional Sale Deed which debars itsBassignment to any other person. The clause only mentions regardingright of repurchase. The option is given to the vendors with the obligationson the vendee. The right to repurchase in the present case has beenassigned by Kishori Lal Sahu (now deceased) in favour of respondentno.1 who is none else than his daughter-in-law to whom other propertieshave also been gifted.C

23. Even the argument raised by learned counsel for the appellantthat such an assignment of a right cannot be treated as a gift asconsideration money is involved, is also noticed and rejected for thereason that the executor of the Gift Deed i.e Kishori Lal Sahu (nowdeceased) had transferred his right to repurchase the property in favourDof respondent no.1. That right could always be assigned by him withwhatever conditions attached to it. Further in the suit filed, he was alsoa plaintiff, who died later.

24. For the reasons mentioned above, we do not find any error inthe judgment of the High Court. The present appeal is accordinglyEdismissed. There is no order as to costs.

Divya Pandey

(Assisted by : Shevali Monga, LCRA)

Appeal dismissed.

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