Oral Agreement to Sell Cannot Supersede Tenancy Obligations or Confer Possession Rights Without Registered Instrument

The Plaintiff (Respondent) filed a suit for eviction and mesne profits regarding Suit Property No. 198, Munirka Enclave.

The Defendant (Appellant) was inducted as a tenant via a Lease Deed dated 23.12.2011, which was renewed multiple times until it finally expired by efflux of time on 30.06.2018.

The Defendant refused to vacate, claiming that an oral Agreement to Sell was entered into in October 2014 for Rs. 1.72 Crores, of which he allegedly paid Rs. 25,00,000 in cash.

Consequently, the Defendant filed a separate suit for Specific Performance.

The Trial Court allowed the Plaintiff’s application under Order XII Rule 6 of the CPC, passing a decree for possession based on the Defendant's admissions of the landlord-tenant relationship and the expiry of the lease.

1. Whether a decree for possession under Order XII Rule 6 CPC can be passed when the tenant claims the existence of an oral Agreement to Sell.

2. Whether the Defendant was entitled to protection of possession under Section 53A of the Transfer of Property Act, 1882.

3. Whether the Civil Court's jurisdiction was barred by an arbitration clause in the expired lease deed.

The court applied Order XII Rule 6 of the CPC, which permits judgment on admissions where the landlord-tenant relationship and the termination of tenancy are undisputed.

It relied on Section 106 and Section 108(B)(q) of the Transfer of Property Act, 1882, establishing that a lessee is bound to restore possession upon determination of the lease.

The court invoked the principle of "once a tenant, always a tenant," citing M.R. Sawhney v. Doris Randhawa.

It further applied Section 53A of the Transfer of Property Act and Section 17(1A) of the Registration Act, 1908, which stipulate that protection of part-performance requires a registered document.

Precedents like Md. Raza v. Geeta and M/s Jagdambey Builders v. J.S. Vohra were used to clarify that an agreement to sell does not transfer title or alter the character of possession from tenant to owner until a decree of specific performance is executed.

The Court observed that the Defendant categorically admitted to being a tenant and that the lease had expired by efflux of time.

The Court rejected the defense of an oral Agreement to Sell, noting it was vague, lacked proof of payment (Rs. 25 Lakhs in cash), and was contradicted by the fact that the Defendant continued to sign new Lease Deeds after the alleged 2014 agreement.

Legally, the Court reasoned that even if an oral agreement existed, it does not create interest in the property nor does it entitle a tenant to resist eviction unless the requirements of Section 53A of the TPA are met—specifically, a written and registered document, which was absent here.

The Court held that the character of the Defendant's possession remained that of a tenant, and the mere filing of a suit for specific performance does not grant him the right to continue in occupation without paying rent or defying the landlord's title.

Regarding arbitration, the Court noted the Defendant had waived the right by not pressing his Section 8 application and submitting to the court's jurisdiction.

The Court held that without a registered document, the Defendant cannot claim protection under Section 53A of the TPA.

The Appeal and pending applications were dismissed, affirming the decree for possession in favor of the Respondent.