Supreme Court: While hearing a civil appeal against the Judgment of the Patna High Court, the Division Bench of Abhay S. Oka and Rajesh Bindal*, JJ., decided on the issue that whether the vendor can assign the right contained in a sale deed to get the property registered back or the right being personal cannot be assigned? The Court held that the condition of right to repurchase in sale deed will not be personal to the vendor unless the terms in the documents specifically state the same.
Factual Matrix
A conditional sale deed was executed between the owner of the property (vendors) and the daughter of the tenant of the property (‘appellant/ vendee’). The condition in the sale deed was that in case the vendors return the full consideration amount to the vendee by July, 1984, the vendee would return the property by means of a registered sale deed at the cost of the vendors. It was also put in the conditional sale deed that in case the vendors failed to pay the consideration money within the stipulated time, the vendee will become the exclusive owner of the property, till then the vendee would not deal with the property in any manner whatsoever. Later, the owner of the property had executed a registered gift deed dated 14-02-1983 in favour of his daughter-in-law (‘respondent’). It was mentioned therein that the said property was transferred to the appellant by way of registered sale deed dated 05-8-1977, which can be purchased back by the respondent from the appellant.
However, the appellant did not agree to register the sale deed back in the name of the vendors or the respondent even after they were willing to return Rs. 5000/- as per the conditional sale deed. Thereafter, a civil suit was filed by the respondent along with the owner of the property (‘deceased’). The Trial Court and the lower appellate Court had dismissed the suit, however, the Judgments of the Courts below were reversed by the High Court in the second appeal. Thus, aggrieved by the Judgment of the High Court, the appellant had approached the Court.
Analysis of the Issue and Court’s Decision
Whether the vendor can assign the right contained in a sale deed to get the property registered back or the right being personal cannot be assigned?
The Court referred to the trajectory of cases on the said issue, wherein it was opined that “the benefit of a contract of repurchase which did not show that it was intended only for the benefit of the parties contracting, could be assigned. The option given to repurchase the property sold would prima facie be assignable”. The Court also cited T.M. Balakrishna Mudaliar v. M. Satyanarayana Rao, (1993) 2 SCC 740 and Habiba Khatoon v. Ubaidul Huq, (1997) 7 SCC 452, wherein it was held that the right of repurchase was assignable or transferable and cannot be treated as personal to the contracting parties.
Referring to Bhoju Mandal v. Debnath Bhagat, 1963 Supp (2) SCR 82 and Kapilaben v. Ashok Kumar Jayantilal Sheth, (2020) 20 SCC 648, the Court also said that the condition of right to repurchase in sale deed will not be personal to the vendor unless the terms in the documents specifically state the same. Further, the Court said that such a right can always be assigned and the contract containing such condition shall be enforceable, the only exception is that such a right should not be personal in nature. The assignment of obligations in a document is not possible without the consent of the other party, and no implied prohibition of transfer or assignment can be inferred in a document.
Thus, the Court said that in the case at hand, there was no term in the conditional Sale Deed which debarred its assignment to any other person, the clause only mentioned regarding the right of repurchase. The right to repurchase in the present case was assigned by the vendor (now deceased) in favour of the respondent who was his daughter-in-law to whom other properties were also gifted.
[Indira Devi v. Veena Gupta, 2023 SCC OnLine SC 762, Decided on 04-07-2023]
*Judgment Authored by: Justice Rajesh Bindal
Know Thy Judge | Supreme Court of India: Justice Rajesh Bindal
