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        Case ID :

        2009 (2) TMI 825 - SC - Indian Laws

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        Title to immovable property depends on intent and payment conditions; registration alone did not pass ownership here. Under Section 54 of the Transfer of Property Act, ownership in immovable property ordinarily passes on sale for a price paid, promised, or partly paid and ...
                        Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
                          Provisions expressly mentioned in the judgment/order text.

                              Title to immovable property depends on intent and payment conditions; registration alone did not pass ownership here.

                              Under Section 54 of the Transfer of Property Act, ownership in immovable property ordinarily passes on sale for a price paid, promised, or partly paid and partly promised, and registration is strong but not conclusive evidence of transfer. Where the sale deed and surrounding circumstances show that payment of the balance consideration was intended as a condition precedent, title does not pass until that condition is met. The recitals here required payment before the Sub-Registrar, no such payment was made, possession was not delivered, and the purchaser had not shown readiness to pay the balance. On that basis, ownership was held not to have passed on registration.




                              Issues: Whether title in immovable property passes on execution and registration of a sale deed even though the balance sale consideration remains unpaid, or whether payment of the full consideration was intended as a condition precedent to transfer of ownership.

                              Analysis: Under Section 54 of the Transfer of Property Act, 1882, sale of immovable property is transfer of ownership in exchange for a price paid, promised, or partly paid and partly promised. Registration is ordinarily strong evidence of transfer, but it is not conclusive where the deed and surrounding circumstances show that payment of the balance price was a condition precedent to passing of title. The intention of the parties is gathered primarily from the recitals of the sale deed, and where those recitals are clear, the surrounding conduct need not displace them. The vendor's statutory charge under Section 55(4)(b) of the Transfer of Property Act, 1882 arises only where ownership has already passed before full payment. Here, the deed stipulated payment of the balance amount in the presence of the Sub-Registrar, no such payment was made, possession was never delivered, and the purchaser had not shown readiness to pay the full balance consideration. The surrounding facts therefore supported the conclusion that ownership was not intended to pass merely on execution and registration.

                              Conclusion: Title did not pass to the purchaser on registration of the sale deed, since full payment of consideration was intended as a condition precedent; the appeal was therefore correctly dismissed.


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                              ActsIncome Tax
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