Mutation based on an unregistered sale agreement cannot extinguish the owner’s title.

The plaintiff, Mozuammel Haque, alleged that he had agreed to sell 4 kathas 1 lecha of land to Defendant No. 1 for ₹23,000, subject to payment of the balance consideration within three months. According to him, the balance was not paid, the agreement was rescinded, no sale deed was executed, and possession was never delivered to the defendants.

The defendants asserted that the entire consideration had been paid, possession had been delivered in November 1989, and that the plaintiff had consented to mutation of the land in Defendant No. 2’s name.

Criminal proceedings under Sections 107 and 145 CrPC were initiated concerning possession. Although the Executive Magistrate ultimately declared possession in favour of the defendants, the police report recorded that, when possession was allegedly delivered on 02.09.1998, the plaintiff’s house existed on the land and the delivery was merely symbolic.

The plaintiff instituted Title Suit No. 111/1998 seeking declaration of title and possession, a declaration that the criminal-court order was erroneous and unenforceable, and permanent injunction.

The defendants filed a counter-claim seeking enforcement of the alleged agreement for sale, execution and registration of a sale deed, delivery of possession, and injunction.

The Trial Court dismissed the suit and the counter-claim. The First Appellate Court decreed the plaintiff’s suit and affirmed dismissal of the counter-claim. The defendants filed the present second appeals under Section 100 CPC.

Whether the plaintiff’s suit was barred by limitation?

Whether the suit was barred by the proviso to Section 34 of the Specific Relief Act, 1963, because the plaintiff had omitted to seek further relief concerning the agreement for sale?

Whether the First Appellate Court erred in law in declaring the plaintiff’s title over the suit land?

Whether the defendants had established a legally enforceable agreement, payment of the entire consideration, and delivery of possession so as to sustain their counter-claim for specific performance?

The Court applied Section 100 CPC, under which a second appeal lies only on a substantial question of law.

It applied Section 34 of the Specific Relief Act, 1963, holding that the proviso does not bar a suit where the plaintiff seeks consequential reliefs in addition to declaration.

The Court further applied the principle that an agreement for sale does not itself transfer title and that, in the absence of a registered sale deed, mutation in revenue records does not extinguish the original owner’s title or constitute proof of lawful transfer.

The Court also applied the evidentiary principle that the party claiming specific performance must establish the agreement, payment of consideration, readiness and enforceability of the contract, and the alleged delivery of possession through reliable evidence.

The Court held that the plaintiff’s suit was not merely declaratory because it also sought injunction and other consequential reliefs; therefore, the proviso to Section 34 did not apply.

On limitation, the Court found that the plaintiff’s title had not been extinguished by the unregistered transaction or the mutation in favour of Defendant No. 2. Since mutation did not establish a lawful transfer of ownership, the plaintiff could maintain a suit based on his title and possession.

The defendants failed to establish actual possession. The police report referred to the plaintiff’s house and treated the alleged delivery to the defendants as symbolic, while the defendants’ own pleadings sought removal of the plaintiff and recovery of khas possession.

Their evidence regarding payment was also materially inconsistent. The alleged agreement and receipts were either photocopies, varied in their contents, or were not proved in accordance with law. The evidence did not satisfactorily establish payment of the entire consideration or delivery of possession.

Further, the alleged consent to mutation in favour of Defendant No. 2 differed from the original agreement with Defendant No. 1 and was not supported by a corresponding plea or relief concerning novation of the contract.

Consequently, the defendants failed to prove an enforceable basis for specific performance or a superior title.

The defendants’ counter-claim for specific performance and possession was unsustainable because no registered sale deed was executed, mutation did not confer title, and payment and delivery of possession were not proved.

Both second appeals were dismissed, with costs awarded to the respondents.