Unresolved transfer of possession under a development agreement warrants remand for further evidence.

The plaintiff, owner of the suit property, and the defendant entered into an agreement dated 10 July 1997 (Ex.P239) under which the defendant was to construct a building and the plaintiff would sell him the western portion for ₹5,00,000. The agreement also required the defendant to hand over the eastern portion to the plaintiff after construction.

Subsequent arrangements included an agreement dated 8 January 1999 (Ex.P1), an agreement dated 26 June 1999 (Ex.P3) involving Khurshid Anwar taking over construction, and a cancellation agreement dated 2 January 2000 (Ex.P4), which recorded the return of keys and possession to the plaintiff.

The plaintiff sued for a declaration that the agreements were non-est and for a permanent injunction. The trial court decreed the suit, and the first appellate court affirmed. After the Supreme Court remitted the matter for determination of the possession issue, the High Court reconsidered the second appeal.

1. Whether possession was transferred to the defendant under Ex.P239, and, if so, whether it was permissive possession for construction or possession carrying an independent right, and whether it concerned all or only part of the property.

2. Whether the subsequent agreements, particularly Exs.P1, P3 and P4, affected the defendant’s possession or resulted in its return to the plaintiff.

3. Whether Ex.P239 was merely a construction agreement or also an agreement of sale, and whether the available record permitted a final determination of the parties’ rights.

Section 100 CPC confines a second appeal to substantial questions of law, while Order XLI Rule 25 CPC permits an appellate court to remit an omitted issue to the trial court where its determination is essential to the correct decision of the case.

The High Court relied on Remco Industrial Workers House Building Co-operative Society v. Lakshmeesha M., AIR 2003 SC 3167, for the power to remit an omitted issue under Order XLI Rule 25, and Shyam Singh v. Daryao Singh, AIR 2004 SC 348, in support of remand where additional factual and legal issues require determination.

The parties also invoked Section 52 of the Easements Act, 1882, and Section 53A of the Transfer of Property Act, 1882, concerning permissive entry and part performance, but the High Court did not finally determine their application to the dispute.

The central question—whether possession passed under Ex.P239, and its extent and legal character—had not been determined through a specific trial-court issue or finding.

Although Ex.P239, Ex.P3 and Ex.P4 contained material relevant to the construction arrangements and the alleged return of possession, the record did not establish when, or whether, the defendant handed possession of the constructed western portion to the plaintiff or to Khurshid Anwar.

Because resolving possession also bore on the character of Ex.P239 and the relief sought, the High Court considered a further factual inquiry necessary rather than deciding the substantial question of law on the existing record.

The trial court was directed to frame or reformulate appropriate issues, including on the nature of Ex.P239 and transfer of possession, and to allow the parties to adduce further evidence if necessary.

All contentions were kept open, and the trial court was directed to decide the suit independently, without being influenced by the High Court’s observations.