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2025 DIGILAW 498 (TS)

B. v. R. Projects VS Sumana Reddy

2025-04-30

K.SUJANA

body2025
JUDGMENT : K. SUJANA, J. This appeal is filed by the appellant aggrieved by the judgment and decree dated 22.12.2010 in O.S.No.2125 of 2006 on the file of VIII-Additional Senior Civil Judge, Rangareddy District at L.B.Nagar. 2. The plaintiff filed O.S.No.2125 of 2006 to cancel the cancellation of sale deed dated 21.04.2006 and to direct the Sub-Registrar-II to remove the impugned document i.e., cancellation of sale deed from the register and to grant perpetual injunction against the defendants restraining them from interfering with the peaceful possession and enjoyment of the suit property. 3. For the sake of convenience the parties herein after referred to as arrayed in the above suit. The appellant herein is the 6 th defendant in the said suit. 4. The plaintiff purchased Plot No. 76 in Sy.No.45 at Miyapur village, along with two others, through a sale deed executed on 11.07.2005, by the 6 th defendant-M/s. B.V.R. Projects, on behalf of defendants 1 to 5. The plaintiff paid Rs.7,50,000/- towards total sale consideration and got registered the sale deed. However, the plaintiff alleges that the defendants colluded with the Joint Sub-Registrar-II to fraudulently cancel the sale deed on 21.04.2006, without notice or intimation to the plaintiff. The plaintiff claims that the cancellation deed was registered illegally, in violation of the Registration Act, and that the defendants bribed the concerned officials to achieve this. The plaintiff has filed a report with the Lokayukta and Upa-Lokayukta against the Joint Sub-Registrar-II and seeks to have the cancellation deed cancelled. 5. The 6 th defendant filed a written statement denying the allegations made by the plaintiff. According to the 6th defendant, the plaintiff and her husband promised to pay the sale consideration of Rs. 7,50,000/- within a short time and requested the 6 th defendant to execute the sale deed. Believing their words, the 6 th defendant executed the sale deed on 11.07.2005. However, the plaintiff and her husband failed to pay the sale consideration despite repeated demands. Therefore, the 6 th defendant, representing defendant Nos. 1 to 5, executed a cancellation deed canceling the sale deed. 6. The 6th defendant also contended that similar sale deeds were executed in favor of two other individuals, B. Latha Naik and Himabindu, who also failed to pay the sale consideration, cancellation deeds were executed for those sale deeds as well. Therefore, the 6 th defendant, representing defendant Nos. 1 to 5, executed a cancellation deed canceling the sale deed. 6. The 6th defendant also contended that similar sale deeds were executed in favor of two other individuals, B. Latha Naik and Himabindu, who also failed to pay the sale consideration, cancellation deeds were executed for those sale deeds as well. The 6 th defendant denied the allegations of bribery and claimed that the cancellation deed was registered according to law and in accordance with the Registration Act. In support of his contention, learned counsel relied on the judgment of the Full Bench in Yanala Malleshwari and Others V Ananthula Sayamma and others , [2006 (6) ALD 623 (FB)] , wherein it was held that unilateral cancellation of sale deed is valid. The 6 th defendant claimed that the plaintiff's failure to pay the sale consideration led to the cancellation deed and that the suit is liable to be dismissed. 7. The plaintiff filed a rejoinder to the written statement, contending that the allegations made by the 6th defendant are false. According to the plaintiff, the recitals of the sale deed indicate that she paid the sale consideration, which was received by the 6 th defendant. The plaintiff also pointed out that the Sub-registrar-II made an endorsement indicating that the cancellation deed is invalid. The plaintiff argued that unilateral cancellation is not valid as per law and that she had sufficient means to pay the sale consideration, being employed with Ideas Cellular Ltd. The plaintiff reiterated her allegations against the Sub-registrar and claimed that the cancellation deed is invalid. 8. Basing on the above pleadings, the trial Court framed three issues. On behalf of the plaintiff Pws.1 and 2 were examined, Exs.A.1 to A.6 were marked and on behalf of the 6 th defendant Dws.1 and 2 were examined and Exs.B.1 to B.3 were marked. After hearing both sides, the trial Court decreed the suit and aggrieved by the same, the 6th defendant preferred this appeal. 9. Heard Sri Rajagopallavan Tayi, learned counsel for the appellant-6th defendant and Dr.K.Lakshmi Narasimha, learned counsel for the respondent No.1-plaintiff. 10. The contention of learned counsel for the 6 th defendant is that the impugned judgment is against the principles of natural justice and good conscience. 9. Heard Sri Rajagopallavan Tayi, learned counsel for the appellant-6th defendant and Dr.K.Lakshmi Narasimha, learned counsel for the respondent No.1-plaintiff. 10. The contention of learned counsel for the 6 th defendant is that the impugned judgment is against the principles of natural justice and good conscience. The judgment is also considered perverse and palpably wrong, as it failed to consider the nature of the claim made by the plaintiff. The court below framed an additional issue and gave a specific finding that the facts and circumstances create grave doubt about the version of plaintiff, yet held that plaintiff is entitled to have the cancellation deed canceled. The 6 th defendant argues that this finding is contradictory and flawed and the court below erred in holding that the rule incorporated in the year 2006 has no prospective effect and that the 6th defendant cannot cancel the document. The court below also failed to appreciate that the plaintiff promised to pay the sale consideration within 10 days but failed to do so, which amounts to cheating and fraud. 11. The further contention of learned counsel for the 6 th defendant is that the court below erred in holding that the sale deed cannot be canceled due to non-payment of sale consideration. The 6th defendant contends that Section 54 of the Transfer of Property Act and the decisions relied upon by the plaintiff are not applicable to the present case. It is further contended that the court below failed to appreciate that there was no bar under the Registration Act, 1908 , to execute a deed of cancellation canceling the sale deed for non- payment of sale consideration. The 6th defendant seeks to set aside the impugned judgment and decree, arguing that the court below made several errors in law and fact that the plaintiff’s entitlement to have the cancellation deed canceled is not supported by law or evidence. 12. On the other hand, learned counsel for the plaintiff would submit that cancellation deed was executed on the ground that sale consideration was not paid. If the sale consideration is not paid, the recourse available is to file a suit for recovery of sale consideration, but not execution of cancellation of sale deed, which is nothing but violation of Rule 26 (k) (i) of the Andhra Pradesh Rules under the Registration Act. The said registration is illegal, null and void. If the sale consideration is not paid, the recourse available is to file a suit for recovery of sale consideration, but not execution of cancellation of sale deed, which is nothing but violation of Rule 26 (k) (i) of the Andhra Pradesh Rules under the Registration Act. The said registration is illegal, null and void. The findings of the trial Court on additional issue of IDBI Loan is not germane and it is irrelevant to the present case. The legal question is whether the registered sale deed can be cancelled unilaterally, even if the loan is not approved has no bearing on the legal invalidity of the cancellation of sale deed. Hence, prayed to dismiss this appeal. 13. Considering the submissions made by both the counsel and the material on record, the suit is filed by the plaintiff for cancellation of cancellation of sale deed on the ground of non- payment of sale consideration. The trial Court initially framed only two issues, later additional issue was framed on sale consideration as the plaintiff therein filed re-joinder stating that she paid total sale consideration of Rs.7,50,000/-. 14. Basing on the above, the following points arise for determination : 1. Whether the plaintiff in the suit is entitled for cancellation of cancellation of sale deed ? 2. Whether the judgment of trial Court needs any interference ? POINT NOs.1 and 2 : 15. The suit is filed for cancellation of execution of cancellation of sale deed on the ground that unilateral cancellation is not valid and it is settled principle of contract that if consideration is not paid, the recourse is to file a suit for recovery of the said amount and without giving notice for payment of consideration and without filing a suit for recovery of sale consideration, the 6 th defendant executed registered cancellation deed is void. In support of her contention, plaintiff examined Pws.1 and 2. Pw.1 evidence is that she purchased the suit schedule property for an amount of Rs.7,50,000/- and Pw.2 who is the husband of Pw.1 filed chief-affidavit stating that plaintiff being an employee having monthly income of Rs.25,000/- per month purchased the suit schedule property by obtaining loan of Rs.10 Lakhs from IDBI Bank, Basheerbagh Branch and paid Rs.7,50,000/- to the 6th defendant at the time of registration of sale deed towards sale consideration. As such, non-payment of consideration is baseless and false. 16. As such, non-payment of consideration is baseless and false. 16. On the other hand, Dw.1 who is the 6th defendant filed chief affidavit stating that the husband of plaintiff approached the defendants for purchase of suit schedule property and requested to execute sale deed and that he would pay the sale consideration after obtaining loan from IDBI, within 10 days. The husband of plaintiff is the Regional Manager of IDBI Bank at the time of transaction and believing his words, sale deed was registered in favour of plaintiff, but the plaintiff and her husband failed to keep up their assurance, as such, he cancelled the sale deed. Dw.2 was the Branch Manager of IDBI Bank, filed his chief affidavit stating that as per record, plaintiff approached the Bank for grant of housing loan of Rs.10 Lakhs, the bank sanctioned the loan but she did not receive the loan amount. Pw.2 attested the copy of bank record and produced before the Court to show the cancel pay order and statement. 17. The evidence of Dw.2 would show that plaintiff approached IDBI Bank and availed loan of Rs.10 Lakhs for purchasing the suit schedule property. However, in the present case, whether the plaintiff paid sale consideration or not is not the question before this Court. The question before this Court is whether unilateral cancellation of sale deed is valid in the eye of law. On this aspect the contention of learned counsel for the 6 th defendant is that on the date of execution of cancellation of sale deed, unilateral cancellation is valid. The said amendment was made on 29.11.2006, whereas, the cancellation of sale deed was executed on 21.04.2006. Therefore, it is valid. 18. In support of his contention, learned counsel for the 6 th defendant relied on the Full Bench judgment of A.P.High Court in Yanala Malleshwari’s case, wherein it was observed that when there is no prohibition under the Act for the vendor to get the cancellation deed registered, it cannot be said that unilateral cancellation is void. 19. The Hon’ble Supreme Court in Satya Pal Anand V State of M.P. , [ (2016) 10 SCC 767 ] , relied on the judgment in Thota Ganga Laxmi V State of A.P. , (2010) 15 SCC 207 wherein it was held in paragraph Nos.46 and 47 as under : “46. 19. The Hon’ble Supreme Court in Satya Pal Anand V State of M.P. , [ (2016) 10 SCC 767 ] , relied on the judgment in Thota Ganga Laxmi V State of A.P. , (2010) 15 SCC 207 wherein it was held in paragraph Nos.46 and 47 as under : “46. In our considered view, the decision in Thota Ganga Laxmi [Thota Ganga Laxmi v. State of A.P., (2010) 15 SCC 207 : (2013) 1 SCC (Civ) 1063] was dealing with an express provision, as applicable to the State of Andhra Pradesh and in particular with regard to the registration of an extinguishment deed. In absence of such an express provision, in other State legislations, the Registering Officer would be governed by the provisions in the 1908 Act. Going by the said provisions, there is nothing to indicate that the Registering Officer is required to undertake a quasi-judicial enquiry regarding the veracity of the factual position stated in the document presented for registration or its legality, if the tenor of the document suggests that it requires to be registered. The validity of such registered document can, indeed, be put in issue before a court of competent jurisdiction. 47. In the present case, the document in question no doubt is termed as an extinguishment deed. However, in effect, it is manifestation of the decision of the Society to cancel the allotment of the subject plot given to its member due to non-fulfilment of the obligation by the member concerned. The subject document is linked to the decision of the Society to cancel the membership of the allottee of the plot given to him/her by the Housing Society. In other words, it is the decision of the Society, which the Society is entitled to exercise within the framework of the governing cooperative laws and the bye-laws which are binding on the members of the Society. The case of Thota Ganga Laxmi [Thota Ganga Laxmi v. State of A.P., (2010) 15 SCC 207 : (2013) 1 SCC (Civ) 1063] , besides the fact that it was dealing with an express provision contained in the statutory Rule, namely, Rule 26(k)(i) of the Andhra Pradesh Registration Rules, 1960, was also not a case of a deed for cancellation of allotment of plot by the Housing Society. But, of a cancellation of the registered sale deed executed between private parties, which was sought to be cancelled unilaterally. Even for the latter reason the exposition in Thota Ganga Laxmi [Thota Ganga Laxmi v. State of A.P., (2010) 15 SCC 207 : (2013) 1 SCC (Civ) 1063] will have no application to the fact situation of the present case.” 21. In the above judgments it was observed that registering authority has no adjudicating power to cancel the registered sale deed and unilateral cancellation is not permissible. In Thota Ganga Laxmi’s case also, it was observed that the deed of cancellation of registered sale deed cannot be unilaterally executed, the competent Court can only nullify the said document. 22. In the present case, it is not the contention of 6 th defendant that fraud was played, but the only ground is that no sale consideration was paid, even after registration of sale deed. If the sale consideration is not paid, the recourse to the party is to file a suit for recovery of sale consideration. No notice was issued to the plaintiff for payment of sale consideration and no suit is filed for recovery of sale consideration. As per Section 54 of the Transfer of Property Act, even if consideration is not paid, sale is valid as future consideration is also valid. Therefore, the 6 th defendant has to file a suit for recovery of the said amount. In Thota Ganga laxmi’s case and in Satya Pal Anand’s case, it is reiterated that the sub-registrar has no adjudicatory power to cancel the sale deed on the ground of non-payment of sale consideration, even if it is not paid, he has to file a suit for cancellation of registered sale deed on the ground of non-payment of sale consideration. Therefore, unilateral cancellation is void and not valid. 23. The trial Court has also discussed at length about the unilateral cancellation. Though an additional issue is framed for deciding the point whether consideration is paid by the plaintiff, as the suit is filed on the ground that unilateral cancellation is void, whether consideration is paid or not is not the question before the trial Court. If really sale consideration is not paid, the 6 th defendant has to file a suit, and then the Court can decide accordingly. If really sale consideration is not paid, the 6 th defendant has to file a suit, and then the Court can decide accordingly. Hence, the trial Court has rightly decided that unilateral cancellation is not valid cancellation and it is void. Therefore, I find no illegalities in the judgment of the trial court and there are no grounds for this Court to interfere with the impugned judgment. There are no merits and the appeal is liable to be dismissed. However, the appellant is at liberty to file suit for cancellation of sale deed. 24. Accordingly, the Appeal Suit is dismissed. No costs. Miscellaneous petitions, pending, if any, shall stand closed.