A contracts to sell a piece of land to B for Rs. 20,000 and puts him in possession. He subsequently sells the same plot to C for Rs. 25,000. C takes forcible possession from B. Advise B regarding his remedies.

The Facts and the Legal Questions They Raise

A contracts to sell land to B for Rs. 20,000 and puts B in possession. Before a registered conveyance is executed, A sells the same land to C for Rs. 25,000, and C forcibly takes possession from B. The legal questions that arise are:

1. What is B's status vis-a-vis the property before a registered conveyance is executed?

2. Can B recover possession summarily under section 6?

3. Can B sue for specific performance against A and, if so, with what consequence for C?

4. What is the effect of section 52 of the Transfer of Property Act on C's rights?

5. Is B protected by section 53A of the Transfer of Property Act against C?

6. What remedy lies against A personally?
   

B's Possessory Status: The Agreement for Sale Does Not Create Title

The foundational principle, affirmed by the Privy Council in Pir Bux v Mohd Tahar, AIR 1934 PC 235, is that a contract for sale of immovable property does not by itself create any interest in the land. Section 54 of the Transfer of Property Act, 1882, explicitly provides that a sale of immovable property of the value of one hundred rupees and upwards can only be made by a registered instrument, and that a contract for sale does not of itself create any interest in or charge on the property. Suraj Lamp Industries Pvt Ltd v State of Haryana, AIR 2012 SC 206, (2012) 1 SCC 656, reaffirmed this position. B therefore has no title to the land; he has only a contractual right enforceable in personam against A.

However, the critical distinction for the present purposes is that B, having been put in actual physical possession by A pursuant to the agreement, has acquired juridical possession of the land. As the Supreme Court and the authoritative commentary confirm, "a person may be entitled to the possession of any immovable property either as an owner or as a possessor... mere possessory title is also enough" — Somnath Burman v Dr SP Raju, AIR 1970 SC 846, (1969) 3 SCC 129. A purchaser under an agreement who has been put in possession is in a fundamentally different position from a trespasser; his possession is founded on a contractual right and is, in the language of the courts, juridical possession that the law protects against wrongful interference.

Remedy I: Summary Suit Under Section 6 of the Specific Relief Act

B's Entitlement to the Summary Remedy

The most immediate and efficient remedy available to B is the summary suit under section 6(1) of the Specific Relief Act, 1963, which provides that any person dispossessed without consent of immovable property otherwise than in due course of law may, by suit, recover possession thereof, notwithstanding any other title that may be set up in such suit. In the present problem, B was in actual physical possession pursuant to the agreement and was forcibly dispossessed by C. C's forcible dispossession is plainly otherwise than in due course of law within the meaning of the section.

Three conditions that section 6 demands are clearly fulfilled: (i) B was in settled, juridical possession — his possession was actual, founded on a contract with A, to the knowledge of A, and was undisturbed until C's forcible entry; (ii) the dispossession was without B's consent — it was by force; (iii) it was otherwise than in due course of law — C had no court order or other legal process authorising the taking of possession.

The courts have consistently held that title is wholly irrelevant in a section 6 suit. "Even where the person ousting claims a superior title, the person dispossessed is entitled to be restored to possession if he can prove his previous settled possession and brings an action within six months from the date when the dispossession occurred". C cannot resist the suit by setting up his registered sale deed as a superior title. As the Allahabad High Court stated in Ganga Din v Gokul Prasad, AIR 1950 All 407: "the effect of this section, therefore, is that if a summary suit is brought within six months, the plaintiff therein who was dispossessed otherwise than in due course of law, will be entitled to be reinstated even if the defendant, who dispossessed him, be the true owner, or a person claiming under him". C, who obtained a title from A after A had contracted with B and who then forcibly took possession, falls squarely within this principle.

Limitation and Procedural Aspects

B must file the suit within six months of the date of forcible dispossession by C, as mandated by section 6(2)(a). This period is absolute and cannot be condoned: Mohd Mehtab Khan v Khushnuma Ibrahim Khan, AIR 2013 SC 1099, (2013) 9 SCC 221. The suit is summary; no question of title is to be gone into; no appeal lies from the decree under section 6(3); and the decree operates as a restoration of the status quo ante. It does not, however, determine or adjudicate upon the title of any party. The decree restoring possession to B merely shifts the burden of proof of title to C in any subsequent title suit.

Remedy II: Specific Performance of the Contract Against A

The principal long-term remedy of B lies in a suit for specific performance of the agreement to sell against A under section 10 of the Specific Relief Act, 1963. Under the provision as amended by the Specific Relief (Amendment) Act, 2018, specific performance of a contract relating to immovable property is no longer a discretionary remedy — subject to exceptions, the court shall enforce specific performance if the contract is valid and enforceable. A, having contracted to sell the land to B and received consideration (or part thereof), is bound to execute a registered sale deed in B's favour.

The Position of C — Purchaser With Notice

The critical question is whether a decree for specific performance against A can be executed against C, the subsequent purchaser. The answer depends upon whether C had notice of the prior agreement between A and B. Under section 19(b) of the Specific Relief Act, 1963, specific performance may be enforced against "any other person claiming under him by a title arising subsequently to the contract, except a transferee for value who has paid his money in good faith and without notice of the original contract." This provision directly addresses the facts: C claims under A by a title arising after the contract between A and B. If C had notice — actual, constructive, or imputed — of the prior agreement with B, C is not a transferee in good faith and the decree for specific performance can be enforced against him. If C had no notice whatsoever, he may have a defence.

However, in the facts given, B was in actual possession pursuant to the agreement at the time C purchased. Possession of land by a person other than the vendor is the clearest form of constructive notice recognised by law. Section 3 of the Transfer of Property Act, 1882 — defining notice — provides that a person is deemed to have had notice of any fact if he could have discovered it with ordinary care and inquiry. Any purchaser exercising ordinary diligence would have inspected the land, found B in possession, and made inquiry. B's possession thus operates as constructive notice of B's right to C. In all but exceptional circumstances, therefore, C is not a bona fide purchaser without notice, and the decree for specific performance may be enforced against C as well.

Section 52 of the Transfer of Property Act — Doctrine of Lis Pendens

Once B institutes a suit for specific performance, the doctrine of lis pendens under section 52 of the Transfer of Property Act, 1882, applies. Under this provision, during the pendency of a suit in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit so as to affect the rights of any other party thereto under any decree or order that may be made in the suit. Since the agreement itself relates directly to the property, any further transfer by A during the pendency of the suit is subject to the outcome of the proceedings. C, having taken his transfer either before the suit was filed (which is the position in the problem) or after, is still bound if the suit for specific performance, when filed, establishes his notice of B's prior agreement.

Remedy III: The Protection of Section 53A of the Transfer of Property Act

Section 53A of the Transfer of Property Act, 1882, provides the doctrine of part performance. Where a transferee takes possession of immovable property in part performance of a contract for its transfer and has done or is willing to do his part of the contract, the transferor is debarred from enforcing any right in respect of such property against the transferee inconsistent with the contract.

The legal commentary explains: "As against the vendor and persons claiming under him with notice of the contract, the buyer under a contract for sale has not only a right to sue for specific performance, he has also the right to defend his possession if he has obtained it in pursuance of the agreement under section 53A of the Transfer of Property Act provided the conditions specified in section 53A are satisfied". In the present facts, the conditions for section 53A are satisfied: (a) there is a written contract for the transfer of immovable property, (b) B has taken possession in part performance, and (c) B has performed or is willing to perform his part (payment of Rs. 20,000 or its tender).

The scope of section 53A is, however, limited: it is essentially a shield, not a sword. It enables B to resist an action for ejectment brought by A or by C with notice; it does not, of itself, entitle B to obtain possession by suit against C who has forcibly entered. For an offensive remedy against C, B must rely on sections 6 and 5 of the Specific Relief Act and the suit for specific performance. Nevertheless, once B succeeds in obtaining a decree for specific performance against A, C — being a subsequent transferee with notice — will be bound by that decree and B will be entitled to the land by registered conveyance pursuant to the decree.

Remedy IV: Section 91 of the Indian Trusts Act — C as Constructive Trustee

The position of C, if he purchased with notice of B's prior agreement, is further illuminated by section 91 of the Indian Trusts Act, 1882. The personal obligation created by the contract between A and B is of a fiduciary nature. When a subsequent transferee with notice of the earlier existing contract acquires the property, "the subsequent transferee would hold the property as a trustee for the intending purchaser by the earlier contract. Hence, under section 91 of the Trusts Act, such a person may enforce his right against the subsequent transferee even without having recourse to a suit for specific performance". This remedy enables B to compel C, as constructive trustee, to convey the property to B.

Remedy V: Damages Against A

Independently of all the above, B is entitled to damages from A for breach of contract under the general law of contract, the measure being the loss flowing naturally from A's breach — which would include the difference between the contract price of Rs. 20,000 and the market value of the land, and any consequential losses. If specific performance against A is, for any reason, not decreed (though the 2018 Amendment makes this an exceptional outcome), the suit for compensation under section 19(a) and section 21 of the Specific Relief Act, 1963 is available in the alternative.

Consolidated Summary of B's Remedies

Current Position

B's most urgent and practically effective remedy is the summary suit under section 6 filed within six months, which will restore him to possession irrespective of C's registered title. Simultaneously, B should file a suit for specific performance against A, impleading C as a defendant, in which C — having had constructive notice by reason of B's possession — cannot claim the status of a bona fide purchaser for value without notice. A decree for specific performance, once obtained, will bind C and vest full title in B by registered conveyance. The law, as settled by a long line of authority, refuses to permit A to profit from a double sale and refuses to allow C — who purchased with notice of B's prior agreement and possession — to defeat B's equitable and legal rights. The fundamental principle pervading all these remedies is that possession lawfully obtained will be protected, and no person may take or retain possession by force or by circumventing a pre-existing agreement.